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Oil rises on hope of avoiding 'fiscal cliff'

NEW YORK (AP) -- The price of oil is up more than 2 percent Monday on rising optimism that U.S. leaders will be able to reach a deal to avert the "fiscal cliff."

Benchmark crude rose 2.4 percent, to $2.09, to $89 just after 10 a.m.

President Barack Obama met with the top leaders of the House and Senate on Friday to discuss ways to avoid a series of automatic tax increases and spending cuts scheduled to kick in on Jan. 1 in the absence of government action. Lawmakers have said a budget deal before Christmas is possible.

Economists have been warning of dire consequences if no action is taken, including the possibility of another recession.

Overseas, the escalating conflict between Israel and Hamas also raised concerns about Middle East crude supplies.