Oil price rises after Fed chair hints at stimulus
The price of oil rose Friday following signs that the Federal Reserve might act to boost the economy.
Benchmark U.S. crude rose 27 cents to $96.54 a barrel in afternoon trading.
Oil fell below $96 overnight on worries about Greece's spending then notched a tiny gain in morning trading in the U.S. The gains picked up after The Wall Street Journal reported that it had obtained a letter from Federal Reserve Chairman Ben Bernanke, saying there's room for the Fed "to ease financial conditions and strengthen the recovery." Bernanke wrote the letter to California Rep. Darrell Issa.
Tropical Storm Isaac was another factor behind oil's rise. It has the potential to reach hurricane force in the Gulf of Mexico, which would disrupt oil production and refining in the Gulf region.
"I think there's a lot of angst with what's going on in the Gulf right now," said Patrick DeHaan, a senior petroleum analyst for GasBuddy.com.
At the pump, the national average for gasoline rose more than a penny to $3.73. That's about a quarter more than a month ago and 16 cents higher than a year ago.
Among other petroleum products trading on the New York Mercantile Exchange:
— Natural gas fell 7 cents, or 2.5 percent, to $2.73 per thousand cubic feet.
— Gasoline at New York Harbor rose a penny to $3.12.
— Heating oil fell a penny to $3.13.