Oil rises on new hope of 'fiscal cliff' resolution

AP News

12/17/2012 12:43:29 PM - AP News

NEW YORK (AP) — The price of oil is rising Monday as political leaders in Washington appear closer to a resolution in critical budget negotiations.

President Barack Obama and House Speaker John Boehner met at the White House on Monday in hopes of making more progress toward avoiding the "fiscal cliff," a combination of spending cuts and tax increases that go into effect on Jan. 1.

The meeting came after Boehner on Friday offered to raise taxes on some wealthy earners — but only if Obama agrees to cuts in benefit programs.

Benchmark crude rose 93 cents to $87.66 in early afternoon trading on the New York Mercantile Exchange.

Brent crude, which is used to price international varieties of oil, fell 5 cents to $108.13 on the ICE Futures Exchange in London.

Prices at the pump dropped 4 cents over the weekend to an average of $3.25 a gallon, the lowest level in almost a year.

In other trading on the Nymex:

— Heating oil was flat at $2.98 a gallon.

— Natural has rose 4 cents to $3.36 per 1,000 cubic feet. A gain would be the first in 8 trading sessions.

— Wholesale gasoline added a penny to $2.68 a gallon.