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Oil rises to near $83 after Ireland bank bailout

Oil rises to near $83 after Ireland bank bailout

November 22nd, 2010 by ALEX KENNEDY, Associated Press in News

SINGAPORE (AP) - Oil prices rose to near $83 a barrel Monday in Asia after Ireland agreed to a massive bailout of its troubled banking sector, stemming investor fears that a debt crisis could spread across Europe.

Benchmark oil for January delivery was up 69 cents to $82.67 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose 44 cents to settle at $81.98 on Friday.

Ireland said Sunday it would accept a European Union and International Monetary Fund loan whose terms, conditions and size would be negotiated in the coming weeks. News of the deal helped strengthen the euro, making crude, which is traded in dollars, cheaper for investors with the European currency.

The euro rose to $1.3774 from $1.3673 on Friday.

Some analysts expect recent signs that global oil consumption growth is improving will also help bolster crude prices.

"Oil prices should find support above $80, given the strength in underlying fundamentals," Barclays Capital said in a report. "Recent data releases continue to show a phenomenal pace of recovery in global oil demand."

In Nymex trading in December contracts, heating oil rose 2.2 cents to $2.296 a gallon and gasoline gained 0.1 cent to $2.21 a gallon. Natural gas was up 2.9 cents at $4.19 per 1,000 cubic feet.

In London, Brent crude added 76 cents to $85.10 a barrel on the ICE Futures exchange.