BLBG: Oil Rises in New York First Day in Three on Hope for European Debt Deal
Crude oil rose for the first time in three day on hopes that European leaders will reach a deal to contain the region’s debt crisis.
Futures gained as much as 2.3 percent as European finance ministers meet in Brussels today to lay the groundwork for an Oct. 23 gathering of government leaders for a solution to the debt crisis. Oil also rose after McDonald’s Corp. and Honeywell International Inc. reported profit that beat analyst estimates.
“There is some positive sentiment that Europe is going to be able to accomplish something this weekend,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “Earnings reports suggested that the U.S. economy doesn’t seem to be slowing down considerably.”
Crude for December delivery rose $1.81, or 2.1 percent, to $87.88 a barrel at 9:10 a.m. on the New York Mercantile Exchange.
Brent oil for December settlement gained $1.49, or 1.4 percent, to $111.25 a barrel on the London-based ICE Futures Europe exchange. The North Sea crude’s premium to the U.S. benchmark narrowed to $23.37 amid speculation that Muammar Qaddafi’s death will increase Libyan output. The spread reached a record of $27.88 on Oct. 14.
European leaders may combine temporary and permanent rescue funds to pool as much as 940 billion euros ($1.3 trillion) to fight the debt crisis, two people familiar with the matter said.
A further summit was scheduled for Oct. 26 after Germany and France said the European Union needs more time to seal a “global and ambitious” accord.
Standard & Poor’s 500 futures gained 1.2 percent to 1,224 after McDonald’s and Honeywell’s earnings.
To contact the reporters on this story: Moming Zhou in New York at Mzhou29@bloomberg.net;
To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net
