Oil Rises More Than $1; Pump Prices Inch Higher

The price of oil rose for a second straight day Friday. Meanwhile, gasoline prices ticked higher as the summer driving season wound down.

Benchmark oil for October delivery gained $1.39, or 1.4 percent, to close at $106.42 a barrel on the New York Mercantile Exchange. Oil rose $1.18 a barrel Thursday. Even with the two days of gains, oil fell $1.04 a barrel this week.

Oil rose after the U.S. government said that Americans cut back sharply in July on their purchases of new homes, a sign that higher mortgage rates may weigh on the housing recovery. Traders apparently saw the weak data as an indication that the Federal Reserve may need to wait before slowing down its bond-buying program.

Risk premiums linked to the political crisis in Egypt and labor conflicts at key Libyan ports used to ship oil exports also supported crude oil prices.

Egypt controls the Suez Canal and the Sumed pipeline, crucial transport routes between the Middle East and the Mediterranean Sea through which around 4.5 million barrels of oil and refined products are shipped daily.

Brent crude, which sets prices for imported oil used by many U.S. refineries, gained $1.14 to $111.04 a barrel on the ICE Futures exchange in London.

In the U.S., the average price for a gallon of gasoline ticked up to $3.54. Prices have held fairly steady over the past 10 days, and are down 9 cents so far in August.

In other energy futures trading on Nymex:

— Heating oil added 3 cents to $3.10 per gallon.

— Natural gas fell 6 cents to $3.49 per 1,000 cubic feet.

— Wholesale gasoline gained 3 cents to $2.87 per gallon.

This article appeared in print in the August 26th, 2013 edition of Hamodia.