Oil Rises For Second Day on U.S. Data, Talk of Iran Sanctions: report
Oil rose for a second day as U.S. builders broke ground on more houses than at any time in the past 19 months and on speculation that further sanctions against Iran will curb supply, Bloomberg reported.
It said prices increased as much as 3.8% after the Commerce Department reported housing starts increased 9.3% last month to a 685,000 annual rate, exceeding the highest estimate of economists surveyed by Bloomberg. Gulf Cooperation Council leaders are in Saudi Arabia for a meeting that may address responses to Iran's nuclear program.
Crude for January delivery gained US$3.34, or 3.6%, to US$97.22 a barrel at 10.56 a.m. on the New York Mercantile Exchange. The contract expires today. Prices are 6.4% higher this year after rising 15% in 2010. The more actively traded February contract rose US$3.34 to US$97.39.
Brent oil for February settlement on the London-based ICE Futures Europe exchange increased US$3.41, or 3.3%, to US$107.05.
November housing starts were the most since April 2010. The median estimate of 79 economists surveyed by Bloomberg called for a gain to 635,000. Building permits, a proxy for future construction, climbed to a 681,000 annual pace in November, the highest level since March 2010.
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