The price of oil rose above $94 per barrel Monday after European nations agreed on a bailout for Cyprus, brining some calm to the markets after the latest flare-up in Europe's debt crisis.
Benchmark crude for May delivery was up 50 cents to $94.21 per barrel at late afternoon Bangkok time in electronic trading on the New York Mercantile Exchange. The contract rose $1.26, or 1.4 percent, to close at $93.71 a barrel on Friday.
Cyprus secured 10 billion euro ($13 billion) of rescue loans early Monday, just hours before a deadline set by the European Central Bank. The bank had threatened to halt emergency assistance to the country's banks if no agreement was reached by Tuesday.
The deal requires the Mediterranean island nation to shut down its second-largest bank. All bond holders and people with more than 100,000 euros in their bank accounts will face significant losses. The action is being taken to raise 5.8 billion euros that Cyprus must provide to supplement the rescue loan.
The development comes on top of optimistic expectations for the U.S. economy. Mitul Kotecha of Credit Agricole CIB in Hong Kong said U.S. durable goods orders are expected “to record an impressive gain in February” when the data is released Tuesday. He also said in a market commentary that he expects to see fourth-quarter GDP revised sharply higher.
Brent crude, used to price many kinds of oil imported by U.S. refineries, rose 51 cents to $108.17 a barrel on the ICE Futures exchange in London.
Oil rises after Cyprus financial bailout agreed