BUSINESS
10/10/2011 01:01 EDT | Updated 12/09/2011 05:12 EST

Oil rises to near US$84 in Asia amid encouraging US jobs data, possible Europe debt crisis plan

SINGAPORE - Oil prices rose to near US$84 a barrel Monday in Asia after better than expected U.S. jobs data and signs Europe may move to protect its banks from a sovereign debt crisis.

Benchmark crude for November delivery was up 95 cents at $83.93 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract climbed 39 cents to settle at $82.98 in New York on Friday.

Brent crude was up 20 cents at $106.08 a barrel on the ICE Futures Exchange in London.

The Labor Department said Friday that the U.S. economy added 103,000 jobs last month, more than economists had forecast. Analysts have been concerned in recent months that a sluggish job market could portend a recession in the second half.

A debt crisis in Europe and its possible impact on global economic growth has undermined investor confidence, sending crude to a 12-month low last week at $75.

But prices have bounced back amid hopes European Union leaders will soon implement a major recapitalization of the region's banks to safeguard them against a possible default by some member states such as Greece.

German Chancellor Angela Merkel said Sunday that she and French President Nicolas Sarkozy "are determined to do the necessary to ensure the recapitalization of Europe's banks."

Merkel spoke after talks with Sarkozy at Berlin's chancellery aimed at forging an agreement ahead of a summit of the European Union's 27 leaders later this month.

"As we reach a critical juncture for the world economy, it may seem odd to talk about higher, rather than lower prices," J.P. Morgan said in a report. "But our analysis suggests that Brent oil prices could still move higher over the next two years, reaching $130 at the end of 2013."

In other Nymex trading, heating oil was up 1.0 cent to $2.87 per gallon and gasoline futures added 2.6 cents to $2.67 per gallon. Natural gas shed 1.6 cents to $3.47 per 1,000 cubic feet.

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