Oil rose in New York, trimming a weekly loss, as investors bet that U.S. fuel consumption may climb amid signs of improving confidence and manufacturing growth in the world’s biggest crude consumer. Futures advanced as much as 0.7 percent, after slumping 2.4 percent yesterday, before reports that may show industrial production increased in June and consumer confidence grew this month. Prices also gained as speculation the nation’s credit rating may be cut weakened the dollar, boosting the appeal of commodities priced in the U.S. currency. London’s Brent slid after reaching a record premium to New York prices. “We don’t expect it to be a sudden or a shocking pick-up in the U.S. but we are expecting it to turn around gradually,” said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne, who predicts oil in New York will average $113 a barrel in the third quarter. “Compared to what we have seen in the last month or two, the data has become more positive.” Crude for August delivery increased as much as 65 cents to $96.34 a barrel in electronic trading on the New York Mercantile Exchange, and was at $95.91 at 1:31 p.m. Singapore time. The contract yesterday declined $2.36 to $95.69, the lowest since July 11. Prices are little changed for the week and 25 percent higher the past year. Industrial production, or output at factories, mines and utilities climbed 0.3 percent in June after a 0.1 percent gain last month, economists surveyed by Bloomberg forecast before data scheduled to be released today. Consumer Confidence The Thomson Reuters/University of Michigan preliminary index of consumer sentiment probably rose to 72 in June from 71.5 in May, according to the Bloomberg survey median ahead of a July 15 report. Brent oil for September settlement was at $115.96 a barrel, down 30 cents, on the London-based ICE Futures Europe exchange. The European benchmark grade was at a premium of $19.63 to New York crude after settling at a record of $22.63 yesterday. New York prices slumped yesterday after Federal Reserve Chairman Ben S. Bernanke said he’s not prepared to take immediate action to stimulate the U.S. economy. The central bank may provide more monetary stimulus, known as quantitative easing, if the economy turns out to be weaker than expected, he said. Speculation that the Fed will act may drive oil prices higher next week, a Bloomberg News survey showed. Thirteen of 30 analysts, or 43 percent, forecast oil will rise through July 22. Eleven respondents, or 37 percent, predicted prices will fall and six estimated there will be little change. Last week, 51 percent of those surveyed said futures would drop. Debt Rating Standard & Poor’s became the second ratings company this week to say it may downgrade the U.S.’s top credit grade, sending the dollar lower against most of its major counterparts and driving oil higher. The dollar slid 0.2 percent to $1.4167 to the euro after S&P said there’s at least a 50 percent chance it will cut the AAA rating within 90 days on risks a stalemate will endure beyond any near-term deal to raise the U.S.’s debt limit. Moody’s Investors Service put the U.S. Aaa credit rating on review for a downgrade on July 13 citing concern officials won’t raise the nation’s $14.3 trillion debt limit in time to prevent a missed payment. Even as the ratings companies warned of downgrades, Treasuries still headed for a weekly gain and three auctions this week attracted higher-than-average bidding as the spread in Europe’s debt crisis spurred demand for safer assets. To contact the reporter on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

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