Oil prices up on hopes for positive 'fiscal cliff' talks

Oil prices climbed on Thursday as U.S. political leaders prepared for one last try at reaching a budget deal to avoid the so-called “fiscal cliff.”

Benchmark oil for February delivery rose 27 cents at late afternoon Bangkok time to $91.25 per barrel in electronic trading on the New York Mercantile Exchange. Prices rose sharply on Wednesday on higher U.S. home prices and hopes of a budget deal in Washington. The contract jumped $2.37, or 2.7 percent, to finish at $90.98 per barrel in thin post—Christmas trading in New York.

President Barack Obama was returning to Washington on Thursday after a brief vacation to resume budget talks with Congress. Negotiations are aimed at avoiding the “fiscal cliff,” the deep budget cuts and tax increases that would kick in on Jan 1

Later Thursday, the Conference Board will release its December survey of consumer confidence. The forecast is that the confidence index declined to a reading of 71 from 73.7 in November. A separate survey last week from the University of Michigan showed consumer confidence tumbled this month. Consumers may be starting to worry about whether Congress and Obama can reach a budget deal.

In London, Brent crude, used to price various kinds of foreign oil fell 11 cents to $110.96 per barrel.

In other energy futures trading on the New York Mercantile Exchange- Heating oil rose marginally to $3.0367 a gallon. Wholesale gasoline fell 0.1 cent to $2.8148 a gallon. Natural gas fell 2.3 cents to $3.369 per 1,000 cubic feet.