Oil prices rise to above $109 in London

Oil prices rose Thursday, supported by a tighter supply situation in the United States, analysts said. New York's main contract, light sweet crude crude for delivery in November, climbed 33 cents at $86.44 a barrel. Brent North Sea crude for December gained 63 cents to $109.02 a barrel in London midday deals. "One reason (for the rises) is likely to be US inventory data, published by the US Department of Energy yesterday, indicating that US crude oil stocks fell last week by 4.73 million barrels to their lowest level since February 2010," Commerzbank commodities analyst Carsten Fritsch said Thursday. The overall mood in energy markets was being dictated by economic worries, with investors waiting for results of a summit by European leaders this weekend on how to prevent the debt crisis from further escalating. Initially limited to Greece, Europe's almost two-year-old debt crisis has spilled across borders, threatening large economies as well as the continent's banks. "Markets will look to this weekend's European economic summit for some signs that a workable plan can be crafted to reduce the market stress," said Sanjeev Gupta, head of the Asia-Pacific Oil & Gas practice at Ernst & Young. Capital Economics business consultancy said the eurozone was "heading for recession, and if its public debt and banking crisis is not contained, the rest of the developed world may follow suit." "The United States should avoid another technical recession in the coming quarters, but its recovery looks set to remain lacklustre for years to come," it added in a report. Click here to find out more!