Oil higher on Greek developments

SINGAPORE – Oil was higher in Asian trade Monday on hopes that Greece’s plans to form a unity government would resolve the country’s debt woes, analysts said.

New York’s main contract, light sweet crude for December delivery was 24 cents higher at $94.50 a barrel and Brent North Sea oil for December delivery advanced $1.31 to $113.28.

“We are seeing a positive turn in the oil markets,” said Michael McCarthy, chief market strategist with Sydney-based stockbroking firm CMC Markets.

“To some extent, we are seeing cautious optimism that they (Greece) will elect a new leader tonight,” he told AFP.

A new leader and cabinet to keep the country in the eurozone will be named Monday after talks between outgoing Prime Minister George Papandreou and the conservative opposition chief Antonis Samaras, a government spokesman said.

A historic power-sharing deal was reached in dramatic late-night talks Sunday after Papandreou crucially agreed to step down, removing a key stumbling block hours before jittery financial markets reopened with the euro in the line of fire.

The Greek accord came just ahead of a key eurozone finance ministers meeting on Monday to discuss whether to release an eight billion euro ($11 billion) slice of bailout cash that Finance Minister Evangelos Venizelos says is needed by December 15 to keep the country afloat.

Sunday’s dramatic events capped a week that has been tumultuous even by the recent standards of Greece, which finds itself trapped in the eye of the eurozone debt storm.

The new government will be tasked with implementing the terms of an October EU bailout deal that calls for further harsh austerity measures on Greece, already at breaking point due to a shrinking economy and rapidly rising unemployment.