Brent crude oil futures rose more than $1 per barrel on Tuesday as hopes for progress in resolving the euro zone's debt crisis helped encourage some consolidation after heavy falls in the previous session, аccording to The Economic Times.

But worries over the ability of politicians in Italy and Greece to push through painful reforms deepened and the euro stayed close to the bottom of its range for the month, helping push stock markets in Europe and Asia lower.

Yields on benchmark Italian 10-year bonds climbed towards 7 percent, a level considered unsustainable and approaching 14-year highs around 7.5 percent hit last week before Prime Minister Silvio Berlusconi stepped down.

Spanish 10-year yields also jumped, moving above 6 percent for the first time since the European Central Bank started to buy the country's bonds in August.

Brent futures for December rose $1.10 to a high of $112.99 before easing back slightly to trade around $112.35 by 0905 GMT. The benchmark contract fell $2.27 on Monday after closing at a 15-week high on Friday.

"More selling in oil may be expected in coming days because of concerns about the prospects for growth in Europe," said Victor Shum, managing consultant at Purvin & Gertz. "But we are also entering a strong demand season, which will set a relatively high floor on prices, limiting any pullback."

December Brent was due to expire later on Tuesday. The January contract gained 60 cents to $111.88. U.S. crude oil

fell 20 cents to $97.94. "Investors are constantly in a risk-on, risk-off mode because of the uncertainty in Europe," said Natalie Robertson, an analyst at ANZ.

"The key thing is to look at Europe. Macroeconomic developments are overshadowing everything else."

The Organization of the Petroleum Exporting Countries will watch market developments closely and will be able to work well together, Iran's OPEC governor Mohammad Ali Khatibi said.

OPEC failed to reach consensus on an output deal to contain crude oil prices at its last meeting in June. The group is scheduled to meet again in early December.

PRICE, DEMAND OUTLOOK

Across other commodities, base metals such as copper fell due to the uncertainty surrounding the euro zone, while gold, a safe haven asset, also slipped.

The difference between Brent and the U.S. benchmark has narrowed to around $15 a barrel as the economic uncertainty surrounding the euro zone is having a bigger impact on the European benchmark, Robertson said.

The spread will stay around the current level as rising demand in Asia underpins Brent prices even as output of grades linked to the benchmark such as Libya increases, she said.

Brent's premium to the Middle East marker Dubai fell to its lowest level in nearly five months. The Brent/Dubai Exchange of Futures for Swaps (EFS) for December notionally fell $1.09 from Monday's close to $3.30 a barrel, brokers and traders said.

Investors focused on the euro zone debt crisis. Italy's prime minister-designate, Mario Monti, met the leaders of the biggest two parties to discuss the "many sacrifices," while Greece's new prime minister, Lucas Papademos, told lawmakers reforms were the only way to mitigate painful austerity measures which had deepened the recession.

"Markets are faced with a medium-term outlook full of risk that economic reforms will not survive the political process," said Ric Spooner, chief market analyst at CMC Markets.

France's economy grew by 0.4 percent quarter-on-quarter in the third quarter. A Reuters poll of 31 analysts had predicted an increase of 0.3 percent.

Expectations are that inventories in the world's top oil consumer the United States fell for the second straight time on lower imports and higher refinery runs.

On average, U.S. crude stockpiles were forecast down 1.1 million barrels for the week ended Nov. 11, a preliminary Reuters poll of analysts showed. In the week to Nov. 4, crude stocks fell 1.37 million barrels to 338.09 million.

UkrAgroConsult