BUSINESS

Oil moves closer to US$107 a barrel as optimism builds over Greek debt exchange

03/08/2012 12:05 EST | Updated 05/08/2012 05:12 EDT
NEW YORK, N.Y. - Crude oil prices rose Thursday on hopes that the Greek debt crisis is close to resolution, while traders continued to be concerned about tensions between Israel, the U.S. and Iran.

Benchmark oil for April delivery gained 42 cents to settle at US$106.58 a barrel on the New York Mercantile Exchange after going as high as US$107.20 earlier in the trading session.

In London, Brent crude rose $1.32 to finish at $125.44 a barrel on the ICE Futures exchange.

Commodities were in step with rising world equity markets amid optimism that Greece will be able to complete a bond swap plan with private investors aimed at cutting €107 billion off its national debt. Initial results are due to be announced early Friday.

Crude has risen from $96 last month to near 10-month highs because of worries a military conflict over Iran's nuclear program would disrupt global oil supplies. The U.S. and Europe have imposed sanctions while Iran has threatened to halt crude tankers passing through the Persian Gulf.

On Thursday, an Israeli official claimed satellite images back Israel's contention that Iran is developing a nuclear weapon.

In other energy trading in New York, natural gas prices fell sharply Thursday after spring-like weather blanketed much of the United States, raising expectations that demand will remain weak. At the same time, supplies have stayed well above year-ago levels.

Natural gas fell three cents to finish at US$2.27 per 1,000 cubic feet in New York. The price has fallen about 27 per cent this year and is at the lowest level in a decade.

Heating oil rose five cents to finish at US$3.27 a U.S. gallon (3.78 litres) and gasoline futures increased three cents to end at US$3.31 a gallon.

(TSX:ECA), (TSX:IMO), (TSX:SU), (TSX:HSE), (NYSE:BP), (NYSE:COP), (NYSE:XOM), (NYSE:CVX), (TSX:CNQ), (TSX:TLM), (TSX:COS.UN), (TSX:CVE)