Oil Ends Higher on Optimistic US Budget Deal Outlook


NEW YORK, Oct 16 (Reuters) - Crude oil futures rose on Wednesday as it appeared Congress was close to an 11th-hour deal to raise the government's debt ceiling and prevent a default.

The U.S. government shutdown and fiscal deadlock have roiled financial markets and spurred worries about energy demand in the world's largest oil consumer.

The oil market followed the stock market higher on "optimism that something's going to be accomplished" to reopen the U.S. government, said Gene McGillian, oil analyst with Tradition Energy in Stamford, Connecticut.

Major U.S. stock indexes rose as a senior Democratic aide said the Republican-led House of Representatives was expected to pass the Democratic-led Senate's bipartisan deal to end the standoff. U.S. House Republicans were expected to hold a meeting at 3 p.m. (1900 GMT) to discuss the Senate's plan.

Front-month November Brent crude oil futures expired 90 cents higher at $110.86. December Brent ended $1.17 per barrel higher at $110.59.

Brent's premium over U.S. oil <CL-LCO1=R> has remained between the 10- and 200-day moving averages of $7.62 and $10.04 for the last seven sessions and settled at $8.57 per barrel.

The U.S. benchmark settled $1.08 per barrel higher at $102.29, after trading as high as $102.97. On Friday, the November U.S. oil futures contract lost its premium over December futures <CLX3-Z3>, and the gap between the two contracts has widened further, by as much as 22 cents.


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Brent Crude Oil : $51.78/BBL 0.77%
Light Crude Oil : $50.85/BBL 0.83%
Natural Gas : $2.99/MMBtu 4.77%
Updated in last 24 hours