Oil Up Following Wall Street Gains, Hope For Spain

PABLO GORONDI

Strong corporate earnings reports and hopes that Spain may be close to requesting a bailout to alleviate its debt crisis helped oil prices move higher above $92 a barrel on Wednesday.

By early afternoon in Europe, benchmark oil for November delivery was up 24 cents at $92.33 a barrel in electronic trading on the New York Mercantile Exchange. The contract closed 24 cents higher in New York at $92.09 a barrel on Tuesday.

Brent crude, which is used to price international varieties of oil, was down 26 cents to $113.74 a barrel on the ICE Futures exchange in London.

Investors were encouraged after blue chip companies including toy maker Mattel and Goldman Sachs posted stronger-than-expected earnings for the third quarter, suggesting business is recovering, at least in the U.S., a huge consumer of energy. Stock markets rose Tuesday, adding to their gains on Wednesday.

Analysts said the newfound enthusiasm in markets also stemmed from hopes Spain may accept international aid to help it wade through a tangle of recession, high unemployment and debt.

Spain has been reluctant to ask for help, opting instead to try to fix its problems by instituting economic reforms and slashing government spending.

Relief that Moody's did not cut Spain's credit rating to junk status helped boost the euro against the dollar, which supported oil prices. A weaker dollar makes crude cheaper for investors trading in other currencies. On Wednesday, the euro rose to $1.3121 from $1.3096 late Tuesday in New York.

In other energy futures trading on the Nymex:

â¿¿ Heating oil fell 0.62 cent to $3.1923 a gallon.

â¿¿ Natural gas gained 0.5 cent to $3.442 per 1,000 cubic feet.

â¿¿ Wholesale gasoline added 0.59 cent to $2.808 a gallon.

___

Pamela Sampson in Bangkok contributed to this report.
Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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