Oil rose for the first time in four days in New York after U.S. stockpiles unexpectedly declined and political leaders said they’re optimistic about a budget agreement being reached in the world’s biggest crude consumer. Futures advanced as much as 0.5 percent after sliding 0.8 percent yesterday to a two-week low. Republican House Speaker John Boehner is optimistic that talks on the tax increases and spending cuts known as the fiscal cliff can “avert this crisis sooner rather than later,� he told reporters. President Barack Obama said he hopes to reach a deal before Christmas. U.S. crude supplies slid 347,000 barrels last week, an Energy Department report showed. They were forecast to climb 350,000 barrels, according to a Bloomberg News survey of analysts. “The fiscal cliff is a very significant thing for world economies and therefore oil demand,� said Ric Spooner, a chief market analyst at CMC Markets in Sydney. “The consensus view is that a reasonable compromise will be reached.� Crude for January delivery climbed as much as 40 cents to $86.89 a barrel in electronic trading on the New York Mercantile Exchange and was at $86.83 at 1:56 p.m. Singapore time. The contract pared a decline of as much as $1.82 yesterday to close down 69 cents at $86.49, the lowest since Nov. 15. Prices have fallen 12 percent this year. Brent for January settlement rose 25 cents to $109.76 a barrel on the London-based ICE Futures Europe exchange. The European benchmark contract was at a premium of $22.93 to West Texas Intermediate futures, compared with $23.02 yesterday. Fuel Supplies More than $600 billion in automatic tax increases and spending cuts will kick in next year if an agreement on the U.S. budget isn’t reached. President Obama said at the White House that more Republicans are agreeing on a “balanced approach� to cut the deficit. U.S. gasoline supplies gained 3.87 million barrels last week, the Energy Department figures showed. They were forecast to rise 900,000 barrels, according to the median estimate of 11 analysts in the survey. Distillate inventories, a category that includes heating oil and diesel, fell 800,000 barrels, compared with a projected increase of 500,000 in the survey. Japan’s crude imports from Iran fell 48 percent in October from September to 469,024 kiloliters, or about 95,000 barrels a day, according to data today from the Ministry of Finance. That’s the second-lowest level since the U.S. exempted the Asian nation from sanctions targeting the Middle East country’s nuclear program. Imports declined 63 percent from a year earlier. U.S. and European Union officials say Iran’s nuclear development is aimed at producing atomic weapons, while the government in Tehran says the project is for civilian purposes. U.S. Secretary of State Hillary Clinton in March exempted Japan from sanctions on banks doing business with Iran, saying it had “significantly reduced� imports from the Persian Gulf nation. The waiver was renewed for six months, according to a State Department release on Sept. 14. 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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