Oil rises on new hope of 'fiscal cliff' resolution

Associated Press

NEW YORK (AP) — The price of oil finished higher Monday as political leaders in Washington appear closer to a resolution in critical budget negotiations.

President Barack Obama and House Speaker John Boehner met at the White House on Monday in hopes of making more progress toward avoiding the "fiscal cliff," a combination of spending cuts and tax increases that go into effect on Jan. 1.

The meeting came after Boehner on Friday offered to raise taxes on some wealthy earners — but only if Obama agrees to cuts in benefit programs.

Benchmark crude rose 47 cents to close at $87.20 on the New York Mercantile Exchange.

Brent crude, which is used to price international varieties of oil, fell 54 cents to $107.64 on the ICE Futures Exchange in London.

Prices at the pump dropped 4 cents over the weekend to an average of $3.25 a gallon, the lowest level this year. That's still a penny more than a year earlier, but 17 cents cheaper than a month ago.

In other trading on the Nymex:

— Heating oil fell 2 cents to $2.96 a gallon.

— Natural gas rose 4 cents to $3.36 per 1,000 cubic feet, its first gain in 8 trading sessions.

— Wholesale gasoline fell less than a penny to close at $2.65 a gallon.

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