Oil reached its highest level of the last twenty six months as indication that the US economic recovery is speeding up and that raised hopes that demand for crude in the world's largest oil consuming nation will increase.

Oil went up by 0.6% following the statement of the Fed Reserve Chairman Ben S Bernanke that America might take more measures for enhancing its economy. He further said that the possibility of another recession is quite unlikely. The crude prices also went up as the weather got cold which increased heating demand in the Europe.

The market has its tendency to break the mark of Ninety dollars per barrel as stated by one of the senior principals at energy consultants Purvin & Gertz Inc in Singapore named Victor Shum. The sentiment at present is so strong that no bad news from economy front can affect the rally of oil.

Crude oil meant for January delivery went up by fifty six cents to reach eighty nine dollars and seventy five cents per barrel in the electronic trading of the New York Mercantile Exchange. That was its highest price attends within a day since the 9, October 2008. The contract traded at eighty nine dollars and seventy two cents at thirty six past three pm Singapore time.

As per the report released on December 3, by JP Morgan Chase & Co oil will reach the price of one hundred and twenty dollars per barrel by 2012 as emerging economies will consume more oil. The price of oil futures will be ninety three dollars per barrel on an average in the next year changed from the previous estimate of eighty nine dollars and seventy five cents per barrel.

On December 3 the crude oil traded at eighty nine dollars and nineteen cents per barrel, its highest price since October 2007 at closing. There was an increment of 12.9% in prices in this year.