* U.S. Northeast oil infrastructure recovery continues
* Yemen, Syria tensions supportive to oil
* Investors cautious ahead of U.S. elections
* Coming up: API oil inventory data 4:30 p.m. EST Tuesday
(Recasts with updated prices, market activity)
By Robert Gibbons
NEW YORK, Nov 5 Brent crude jumped nearly 2
percent on Monday, snapping a string of five lower settlements
as stronger U.S. gasoline futures helped oil to rally while
storm-ravaged areas of the East Coast continued to grapple with
the aftermath of Hurricane Sandy.
Brent's gains more than doubled those for U.S. crude,
pushing Brent's premium to its U.S. counterpart CL-LCO1=R back
above $22 a barrel after it slumped to near $20 during the
Traders and analysts pointed to the start of a large unit
overhaul at BP Plc's Whiting, Indiana, refinery as
helping attract investors to Brent.
The expectation is that the refinery work will raise
inventories at the Cushing, Oklahoma, hub, delivery point for
the U.S. light sweet crude contract traded on the New York
The uncertain Middle East, with tensions rising in Saudi
Arabia's neighbor Yemen and ongoing violence in Syria, was also
cited as helping lift crude oil, especially Brent.
"The complex popped near the close reportedly on a flare up
of Middle East tensions along the Yemeni border," Jim
Ritterbusch, president at Ritterbusch & Associates, said in a
The near- and long-term effect of Hurricane Sandy on demand
for petroleum is still unfolding as the U.S. East Coast's
recovery continued after the storm hit the region early last
Around 1.4 million homes and businesses were still without
power on Monday morning, according to the Department of Energy,
even as the key New York Harbor oil network neared normal
operations and fuel terminals resumed operations after power was
restored over the weekend.
Brent December crude rose $2.05 to settle at $107.73
a barrel, recovering after falling during the session to
$104.76, the lowest price since Aug. 1.
Brent reached $108.18, stalling ahead of the 100-day moving
average of $108.34.
U.S. December crude rose 79 cents to settle at $85.65
a barrel, after it slipped intraday to $84.34, the lowest since
prices fell to $84.21 on July 12.
U.S. December RBOB gasoline futures rallied 4.66
cents to settle at $2.6202 a gallon, but only after dropping to
a session low of $2.5524, the weakest gasoline futures price
Gasoline slumped 6 cents on Friday as companies supplying
New Jersey and the New York Harbour - the delivery point for the
U.S. futures contract - restored more operations affected by the
storm and the U.S. government temporarily waived shipping and
fuel production regulations to boost the region's supply.
Gasoline futures reached $2.9375 a gallon during last
Wednesday's session, after the storm struck the New York region
on Monday night and on the day October refined products futures
U.S. December heating oil , the benchmark
distillate contract, also pushed higher, rising 3.55 cents to
settle at $2.9829 a gallon.
U.S. ELECTION TUESDAY
U.S. shares on Wall Street and the dollar inched higher as
investors exhibited caution the day before Americans choose a
president and as Greece headed into two key votes to secure
further rescue funds.
Markets are worried about the outcome of Congressional talks
over the 'fiscal cliff,' a package of tax increases and spending
cuts that will take effect in January if there is no long-term
pact to cut the U.S. budget deficit.
If policymakers are unable to fashion a solution to avoid
the fiscal cliff, it could push the world's biggest economy into
a recession and cut energy demand more than expected.
"After the election, more confidence should come into the
markets," said Eugen Weinberg, an energy analyst at Commerzbank
in Frankfurt. He added that investors were also awaiting the
outcome of the Chinese 18th Party Congress this week.
"We expect the new leadership in China to undertake further
economic support measures which will have a positive impact on
commodities," he said.
(Additional reporting by Claire Milhench in London and Ramya
Venugopal and Rebekah Kebede; Editing by Marguerita Choy)