Oil up with equities, North Sea snag helps

LONDON - Brent crude rose on Friday, boosted by gains in equity markets and delays on key North Sea crude oil loadings.

By (Reuters)

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Published: Fri 16 Sep 2011, 6:50 PM

Last updated: Tue 7 Apr 2015, 5:50 AM

Brent crude for November gained 60 cents to $112.90 a barrel by 1154 GMT, having risen more than $1 earlier.

U.S. crude dipped by 18 cents to $89.22. The November Brent contract and prompt U.S. crude have risen about 2 percent so far this week.

“Brent futures strengthened as central banks teamed up to jointly provide European banks with additional funding,” Vienna-based JBC Energy said in its daily research note.

“The joint action comes as a (temporary) relief for the banking system at a time when international investors are increasingly reluctant to lend money. The move also sparked a rally on European stock markets.”

World shares rose over half a percent to one-week highs on Friday on hopes that European policymakers might at last come up with measures to combat a deepening debt crisis but the euro gave up some of the gains seen in the previous session.

European shares were rising in early trading led by banks, extending its rally. The FTSEurofirst 300 index of top European shares was up for the fourth day

U.S. Treasury Secretary Timothy Geithner urged euro zone ministers to leverage their 440 billion euro bailout fund and free more resources to tackle the debt crisis during a meeting on Friday, a senior euro zone official said.

North sea delays

North Sea Forties crude, one of the key crude oil streams used to price about two thirds of global physical oil, has been suffering from production problems and loading delays since May, supporting Brent crude futures.

Shipments of Forties crude oil are being further delayed due to production shortfalls, trade sources said on Thursday.

But economies in most developed countries remained weak, weighing on oil demand.

New claims for U.S. jobless aid rose unexpectedly last week and factory activity along much of the Eastern seaboard contracted early this month.

The economic weakness is now being reflected in U.S. oil demand readings. The nation’s total fuel consumption over the past four weeks fell 0.9 percent from a year earlier, while gasoline use over the summer declined to an eight-year low, according to the Energy Information Administration.

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