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Hope of "cliff" resolution sends oil to 47 cent increase

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

The Associated Press

12/17/2012

NEW YORK  — 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 a barrel 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 (85 cents a liter), the lowest level this year.

In other energy futures 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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