Markets

Oil Up On U.S. Fiscal Deal, China Data, Middle East Tensions - report

In oil trading, London's benchmark Brent crude surged almost 2% to an 11-week high of nearly $113 per barrel, before easing back to around $112 by 1700 GMT, Reuters reported.

Brent averaged more than $111.65 per barrel last year, the highest annual average on record, after geopolitical threats to production offset worries about flagging oil demand. It finished up 3.5% for 2011.

U.S. crude rose around 2% in Friday's session to $93.87 a barrel, its highest since Sept. 21. It gained 7 percent through last year.

The U.S. fiscal deal aside, oil found support from robust data out of China pointing to a recovery in the world's second-largest economy and No. 2 oil consumer. China's official manufacturing purchasing managers' index held steady in December at 50.6, according to data issued on Monday, adding to evidence that its economy was picking up in the last three months of 2012 after slowing for seven straight quarters.

Tensions in the Middle East, which produces the bulk of the world's oil, helped crude prices as well. Fourth largest oil exporter Iran was carrying out naval drills in the Strait of Hormuz, a waterway Tehran has threatened

to block if it comes under military attack over its disputed nuclear program. Some 40% of the world's sea-borne oil exports pass the strait.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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