Oil rises to near $82 in Europe as traders look for new catalyst to extend rally

Oil rises to near $82 amid mixed stock markets

Oil prices hovered above $81 a barrel Tuesday as traders looked for a new catalyst to extend last week’s rally amid mixed regional stock markets.

By early afternoon in Europe, benchmark oil for November delivery was up 14 cents to $81.59 a barrel in electronic trading on the New York Mercantile Exchange. The contract lost 11 cents to settle at $81.47 on Monday. Earlier on Monday, it rose to $82.38, the highest level since Aug. 6.

Analysts said oil’s gains could be attributed to bountiful cash available to financial speculators who were putting their money in commodities.

“Oil prices are mainly finding support from investors, as is evident from the rise in speculative net long positions in crude oil,” said a report from Commerzbank in Frankfurt.

Oil has plodded along in the $70s for most of the last year, but broke above $80 last week, bolstered in part by a rally in global stock markets. Oil traders often look to equities as a barometer of overall investor sentiment, and the Dow Jones industrial average rose 10.4 percent last month.

The Dow slid 0.7 percent overnight. Asian stock markets were mixed while most Europe were slightly higher on Tuesday.

Investors will be closely watching Friday’s monthly jobs survey and earnings on Thursday from Dow industrials component Alcoa Inc., a report that marks the traditional kickoff to the quarterly earnings season.

“The overhang of uncertain macroeconomic sentiment has acted as a drag on prices, and we are not convinced that those pessimistic clouds have drifted away just yet,” Barclays Capital said in a report.

The American Petroleum Institute will release its report on oil stocks later Tuesday, while the report from the Energy Department’s Energy Information Administration — the market benchmark — will be out on Wednesday.

Data for the week ending Oct. 1 is expected to show draws of 1.3 million barrels in crude oil stocks and a rise of 700,000 barrels in gasoline stocks, according to a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos.

In other Nymex trading in November contracts, heating oil gained 1.20 cents to $2.2967 a gallon and gasoline was up 1.01 cents to $2.1034 a gallon. Natural gas rose 1.8 cents to $3.745 per 1,000 cubic feet.

In London, Brent crude was up 44 cents at $83.72 a barrel on the ICE Futures exchange.

Associated Press writer Alex Kennedy in Singapore contributed to this report.