BUSINESS
10/24/2011 12:47 EDT | Updated 12/24/2011 05:12 EST

Oil above US$90 a barrel; up more than 3 per cent on signs of U.S., Asian growth

NEW YORK, N.Y. - Oil prices climbed to their highest level in more than a month on Monday on signs of economic growth in the United States and Asia.

Benchmark crude rose $3, or 3.5 per cent, to US$90.41 a barrel at midday in New York. Benchmark West Texas Intermediate crude has not been above US$90 per barrel since Sept. 15. Brent crude rose $1.40 to US$110.86 a barrel in London.

Prices rose as a string of acquisitions and a better profit forecast from Caterpillar sparked a rally on Wall Street.

HSBC said that China's manufacturing sector continues to expand as the bank's measure of industrial production showed Chinese manufacturing activity increased from last month.

Energy demand tends to rise as factories crank into a higher gear, and analysts took the report as a sign that China, the second biggest oil consumer behind the U.S., will continue to drive increases in world oil demand this year.

Japan said exports rose 2.4 per cent last month, as its economy recovers from the devastating earthquake and tsunami in March.

In other energy trading, heating oil rose three cents to US$3.0418 a U.S. gallon (3.79 litres) and gasoline futures increased two cents to US$2.6740 a gallon. Natural gas fell one cent to $3.619 per 1,000 cubic feet.

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