Oil prices rise before weekly US inventories report

5th December 2012, Comments 0 comments

World oil prices rose on Wednesday in cautious deals before the weekly US energy stockpiles report, but gains were capped by uncertainty over budget talks to avert the so-called fiscal cliff.

Brent North Sea crude for January added 33 cents to $110.17 a barrel in London midday deals.

New York's main contract, light sweet crude for delivery in January, gained 25 cents to $88.75 a barrel.

"Crude oil prices corrected slightly higher following yesterday's sell-off that dominated the market," said analyst Myrto Sokou at Sucden Financial Research.

The market had fallen on Tuesday amid uncertainty surrounding US budget talks that are aimed at averting the fiscal cliff of automatic tax hikes and spending cuts that are due to kick in on January 1.

On Wednesday at 1430 GMT, the US government's Department of Energy (DoE) will publish its weekly snapshot of American crude reserves for the week ending November 30.

Analysts polled by Dow Jones Newswires predict that the report will reflect a decrease of 400,000 barrels of crude oil.

The closely watched data is considered a barometer of demand in the world's biggest oil-consuming country.

© 2012 AFP

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