Oil prices hit three-month high. US eyes oil reserves.
Oil prices jump to $96 a barrel, the highest level since May, on improved prospects for the economy. Obama administration says tapping strategic oil reserve is an option.
The price of oil rose to its highest point in three months Friday, topping off four straight days of gains, on signs U.S. consumers are gaining confidence in the economy.Skip to next paragraph
Subscribe Today to the Monitor
Benchmark oil rose 41 cents in New York to end at $96.01 per barrel — the first time it's finished above $96 since May 11. It gained 3.4 percent this week on positive economic data and a drop in U.S. oil supplies, and is up 23 percent from its late-June low.
The Thomson Reuters/University of Michigan preliminary August index of consumer sentiment released Friday showed its highest level since May. Most economists had been expecting a decline. That, combined with surprisingly strong retail sales and housing data, spread hope this week that the economy is gaining traction. Consumer spending drives roughly 70 percent of growth.
Word that the Obama administration is considering a release of oil from the Strategic Petroleum Reserve to stem the rising cost of crude appeared to have more impact on Brent crude, which is used to price international varieties of oil.
Brent fell $1.56 to close at $113.71 a barrel on the ICE Futures exchange in London. Before Friday, Brent had climbed more than $10 per barrel this month on concerns about production outages in the North Sea. It's also more influenced by developments in the Middle East.
A senior administration official, who requested anonymity because they were not authorized to speak publicly, told The Associated Press Friday that the U.S. is monitoring gas prices to see whether they fall before making a decision to tap strategic reserves.
Gas prices in the U.S. have increased an average of 39 cents a gallon (3.8 liters) since early July, because of an increase in oil prices and refinery and pipeline problems in some regions. Drivers in about 40 states are now paying more for gas on average than at this time a year ago.
The U.S. released oil from its Strategic Petroleum Reserve last summer with only limited success. Oil prices dropped nearly 5 percent when the government announced the release of 30 million barrels from the SPR on July 23. Prices rebounded over the next eight days. Oil ended the year higher than it started.
Other energy futures prices on the New York Mercantile Exchange:
— Heating oil fell 3 cents to finish at $3.09 per gallon.
— Wholesale gasoline fell 5.6 cents to end at $3.03 per gallon.
— Natural gas fell less than a penny to finish at $2.72 per 1,000 cubic feet.