* Hopes of U.S. budget deal help lift oil, equities
* Top U.S. House Republican less optimistic on budget deal
* Egypt, Syria crises continue to support oil prices
* Coming up: CFTC positions data 3:30 p.m. EST Friday
(Adds gasoline, heating oil prices)
By Joshua Schneyer
NEW YORK, Nov 29 Oil prices rose on Thursday for
the first time this week as investors grew more optimistic that
U.S. lawmakers will resolve a budget fight and increasing Middle
East tensions stoked fear about potential disruptions to oil
A U.S. budget deal would help avoid the "fiscal cliff"
scenario of about $600 billion in automatic tax increases and
spending cuts. In recent days, Republican and Democratic
lawmakers have expressed optimism a deal will be reached.
U.S. Treasury Secretary Timothy Geithner, head budget
negotiator for President Barack Obama, met congressional leaders
on Thursday, although House Speaker John Boehner, a Republican,
said talks have made "no substantive progress."
A weakening dollar and rising U.S. equities also
buoyed oil. A weaker dollar makes dollar-denominated crude
cheaper for holders of other currencies. Escalating violence and
political tension in Syria and Egypt also stoked fear of oil
Crude futures pushed higher after three straight lower
settlements, putting Brent and U.S. crude futures on pace to
post monthly gains of around 2 percent.
"The developments in the Middle East keep pumping up the
security premium and that is helping push crude higher along
with the hopes that a fiscal deal can be reached in Washington,"
said John Kilduff, partner at hedge fund Again Capital LLC in
Brent January crude rose $1.25 a barrel to settle
at$110.76, topping its 50-day moving average price of $110.58.
Earlier on Thursday, Brent's $111.30 session peak was near a
200-day moving average of $111.47. A breach of moving average
levels can encourage buying, propelling prices further.
U.S. January crude settled up $1.58 at $88.07 a
barrel. During the session, U.S. crude traded as high as $88.69
a barrel, reaching its 50-day moving average.
"A dose of optimism toward resolution of the fiscal cliff
issue appeared to bring in some speculative buying interest,"
Illinois-based energy analyst Jim Ritterbusch wrote in a note.
Other commodities also rose on Thursday, with copper, a
major economic bellwether, reaching its highest price in more
than a month.
U.S. December gasoline futures rose nearly 2 percent
to settle at $2.7870 a gallon. U.S. December heating oil
rose 1.1 percent to settle at $3.0406 a gallon. The oil product
contracts for December delivery expire on Friday.
On Wednesday, President Barack Obama and Boehner, the top
Republican in Congress, expressed hopes that a budget deal could
be reached. Boehner was less optimistic on Thursday, when he
accused Democrats of failing to "get serious" about a deal.
U.S. data showed the world's biggest economy grew faster
than initially thought in the third quarter, but consumer and
business spending were revised lower.
Oil output from OPEC member countries has declined in
November to its lowest since January because of disruptions to
Nigerian output and reduced supplies from Angola and Libya, a
Reuters survey found on Thursday.
Supply from the 12-member Organization of the Petroleum
Exporting Countries has averaged 31.06 million barrels per day
(bpd), down from 31.15 million bpd in October, the survey of
sources at oil companies, OPEC officials and analysts found.
OPEC is likely to keep its current output target of 30
million barrels per day when its members meet next month, OPEC
delegates told Reuters.
MIDDLE EAST TURMOIL
In Egypt, two people have been killed and hundreds injured
in countrywide protests ignited by the decree that embattled
President Mohamed Mursi issued last Thursday that gave him
sweeping powers and placed them beyond legal challenge.
On Thursday, an alliance of Egyptian opposition groups
pledged to keep up protests against Mursi and said broader civil
disobedience was possible to fight what it described as an
attempt to "kidnap Egypt from its people."
The U.N. nuclear agency made no progress in a year-long push
to find out if Iran worked on developing an atomic bomb, its
chief said on Thursday, calling for urgent efforts to end
Tehran's standoff with the West.
Israel and its Western allies accuse Iran of trying to
develop a nuclear weapon, while Tehran insists its nuclear
program is purely for civilian use.
(Additional reporting by Robert Gibbons in New York, Simon
Falush in London and Luke Pachymuthu in Singapore; Editing by
Marguerita Choy, Bob Burgdorfer, Andre Grenon and David