Oil gains on European hopes, Iran tension

U.S. crude price gained on Tuesday amid hopes for a deal on the debt crisis by European Union leaders and concerns over Iran. With no major economic data coming out, concerns over new developments in the European debt crisis kept weighing on the markets. After ratings agency Standard & Poor's put 15 euro zone countries on"CreditWatch negative," including six triple-A countries in this bloc, investors hoped that the move would push European leaders to iron out a decisive solution to the debt crisis at their crucial summit on Dec. 9. Hopes for a productive EU Summit bolstered the markets. The announcement made by German Chancellor Angela Merkel and French President Nicolas Sarkozy that they had agreed to a plan for a revised European treaty added to the optimism. Before market close, reports that EU officials might create two rescue funds to help contain the sovereign debt crisis also helped lift market sentiment. Besides, concerns over Iran's oil supply disruption lingered. As Iran faced the mounting pressure of sanctions, investors worried that world supply could be effected as other OPEC member countries expressed no intention to raise output. Light, sweet crude for January delivery gained 29 cents, or 0. 29 percent to settle at 101.28 dollars a barrel on the New York Mercantile Exchange. In London, Brent crude for January delivery rose 83 cents, or 0.76 percent to close at 110.64 dollars a barrel.