Oil prices gained on expectations of a stable revival in US demand, following strong economic data, as well as an encouraging announcement from the Federal Reserve on monetary stimulus.

Brent crude rose by five cents to $108.93 per barrel, while US oil increased by three cents to $108.07, reported Reuters.

Oil prices received a boost after new claims for jobless benefits dropped and key factory data improved in the US, while the country’s crude stocks stumbled for a third straight week.

The price rally was aided by Federal Reserve Chairman Ben Bernanke’s speech before the Congress on Wednesday, where he said the Fed will start withdrawing its stimulus only after it is confirmed that the economy is strong enough.

China has requested local governments expedite spending of this 2013 budget to support economic growth, indicating further optimism about a revival in oil demand growth.

Uncertainties related to supply from the Middle East have also supported prices, while Brent remained above $100 for most of 2012 and in 2013, mainly due to the West’s disagreement with Iran over Tehran’s controversial nuclear programme.

Oil also received support from the civil war in Syria, as investors were apprehensive that the civil war could spread into neighbouring regions.

Image: Oil prices got a boost from strong economic data from the US. Photo courtesy of freedigitalphotos.