Oil prices inch back over $90 as ECB moves awaited

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Associated Press

Posted on July 31, 2012 at 7:00 AM

Updated Tuesday, Jul 31 at 7:30 AM

Oil prices inched above $90 a barrel Tuesday as investors remained confident that European policymakers will deliver new measures to get a grip on the debt crisis and save the euro.

By early afternoon in Europe, benchmark crude was up 43 cents at $90.21 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 35 cents to $89.78 on Monday in New York.

In London, Brent crude was up 23 cents at $106.43 on the ICE Futures exchange.

Oil prices have advanced since last week's vow from European Central Bank chief Mario Draghi to do whatever it takes to keep the euro common currency intact.

Similar remarks from the leaders of France and Germany have helped boost confidence that something big is imminent. The ECB meets Thursday and expectations are high that Draghi will announce that the central bank will at least announce its plan to resume purchases of government bonds to lower borrowing costs of financially troubled European countries, notably Spain and Italy.

Before the latest bout of confidence, oil prices had fallen from about $106 a barrel nearly three months ago as Europe's debt crisis dragged on the global economy and China's growth slowed, reducing demand for crude.

Investors are also awaiting fresh information on U.S. stockpiles of crude and refined products.

Data for the week ending July 27 is expected to show a draw of 1.6 million barrels in crude oil stocks and a build of 400,000 barrels in gasoline stocks, according to a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos.

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.

In other Nymex energy futures trading, gasoline was up 0.24 cent at $2.8202 a gallon and heating oil fell 0.3 cents to $2.8784 a gallon. Natural gas rose 0.9 cents to $3.223 per 1,000 cubic feet.

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