Oil prices gain ahead of Fed meeting

Oil prices moved up Monday on speculation that the US Federal Reserve would maintain the pace of stimulus during its two-day monetary meeting starting Tuesday. The Fed will hold its October policy meeting on Tuesday and Wednesday. Economists in general believe the central bank will maintain its current policy given the impact of the U.S. government shutdown and tepid economic data. The stimulus program from U.S. central bank is supportive for the economy and also helpful to the oil prices. Brent crude prices increased 2.5 percent following reports that Libyan crude output fell dramatically in September. Brent crude, the benchmark for international oil, is more sensitive to the changes in Middle East and North Africa. According to the Bloomberg survey of oil companies and analysts, Libyan output tumbled 275,000 barrels to 300,000 barrels a day in September due to labor protests. Light, sweet crude for December delivery increased 83 cents to settle at 98.68 dollars a barrel on the New York Mercantile Exchange,while Brent crude for December delivery gained 2.68 dollars to close at 109.61 dollars a barrel.