Oil gained for a second day in New York as investors speculated that fuel demand will increase amid signs of an economic recovery and moves by European leaders to tame the region’s sovereign debt crisis. Futures climbed as much as 0.8 percent, erasing a decline of 0.5 percent, after Japan said exports rose 2.4 percent last month, beating economists’ estimates. Europe may agree on a blueprint to rein in the debt crisis at a summit on Oct. 26 after leaders yesterday outlined plans to aid banks. Saudi Arabia, the Organization of Petroleum Exporting Countries’ largest oil producer, is waiting for a successor to the crown prince after the death of Sultan bin Abdulaziz Al Saud. “The market is still riding on optimism,” said Jonathan Barratt, a managing director of Commodity Broking Services Pty in Sydney. “Crude did come off a little bit and it might have something to do with a little bit of nervousness in terms of control on compliance in OPEC after the Sultan passed away.” Oil for December delivery was at $87.92 a barrel, up 52 cents, in electronic trading on the New York Mercantile Exchange at 2:26 p.m. Sydney time. The contract rose 1.6 percent to $87.40 on Oct. 21, the highest close since Oct. 18. Prices are down 3.8 percent this year. Brent crude for December settlement climbed 54 cents, or 0.5 percent, to $110.10 a barrel on the London-based ICE Futures Europe exchange. The European benchmark contract traded $22.18 higher than New York futures, compared with a record settlement of $27.88 on Oct. 14. Exports, Hedge Funds Japanese exports rose in September as demand for cars and auto parts increased, the Ministry of Finance said in Tokyo today. The median estimate of 26 economists surveyed by Bloomberg was for a 1 percent increase. Hedge funds boosted bullish bets on oil by the most in five weeks, a report on Oct. 21 showed. Money managers added to wagers on rising U.S. prices by 8.7 percent in the seven days ended Oct. 18, according to the Commodity Futures Trading Commission’s Commitments of Traders report. Sultan’s death on Oct. 22 has set in motion “a challenging moment for Saudi Arabia,” Tarik Yousef, a fellow at the Washington-based Brookings Institute, said in an interview in Jordan. “Observers are anxious about a political vacuum.” Saudi Arabia raised oil supply this year after exports from Libya collapsed during the uprising against Muammar Qaddafi. It boosted production after failing to get OPEC to adopt a 1.5 million-barrels-a-day output increase at a meeting in June. OPEC Meeting OPEC is next scheduled to meet Dec. 14 in Vienna. It will consider altering output in response to an increase in Libyan production, Kuwait’s Oil Minister Mohammad al-Busairy told reporters at a conference at the Dead Sea in Jordan yesterday. Current prices are reasonable for exporters and importers, al- Busairy said. Companies including Eni SpA, Libya’s biggest foreign investor, and Total SA have returned as fighting ebbed. Supply may rebound to 750,000 barrels a day by the end of the year from 430,000 barrels a day now, Nuri Berruien, chairman of state-run National Oil Corp. said Oct. 20. Output was 1.6 million barrels a day in January. Crude in New York has technical resistance at $89.84 a barrel, according to data compiled by Bloomberg. On the weekly chart, that’s the 50 percent Fibonacci retracement of the drop to $32.40 in December 2008 from a record high of $147.27 in July that year. Sell orders tend to be clustered near chart- resistance levels. 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 in Singapore at akwiatkowsk2@bloomberg.net

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