Oil climbs amid growing German business confidence, stronger U.S. profits

NEW YORK, N.Y. – Encouraging news about business confidence in Germany helped drive oil prices higher Friday, a respite from persistent worries about weaker energy demand as a result of Europe’s government debt crisis.

Benchmark West Texas Intermediate crude rose 78 cents to finish at US$103.05 per barrel in New York, while Brent crude added 76 cents to end at US$118.76 in London.

In Germany, the biggest economy in the European Union, a key survey found that business confidence improved in April from March, the sixth straight monthly rise. The survey showed confidence was up not only for current conditions, but for the next six months as well.

Oil prices also rose along with U.S. stock markets amid strong earnings profits from several major corporations.

Benchmark oil has stayed in a range between US$101 and US$105 a barrel this month as investors assessed global economic growth and looked for fresh news about the standoff between Iran and western countries over Tehran’s nuclear program. They’re also concerned about Europe’s financial crisis and a slowdown in China’s economy.

Talks between Iran and the West are scheduled to resume next month. The U.S., Europe and other countries think that Iran may be working on a nuclear weapon. Iran has denied that allegation.

Iran exports more than two million barrels of oil each day. The European Union and the U.S. have imposed sanctions that make it tougher for Iran to sell its oil. In response Iran stopped selling oil to Britain, France, Greece and Spain, although those countries weren’t getting much Iranian oil to begin with.

Iran’s oil minister said his country might cut sales to more European countries if the 27-member bloc fails to show more flexibility toward his country ahead of May’s meetings.

In other trading, heating oil rose a little more than one cent to finish at US$3.14 a U.S. gallon (3.79 litres), gasoline futures fell about a cent to end at US$3.14 a gallon. Natural gas rose two cents to finish at US$1.93 per 1,000 cubic feet.

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