Oil prices jumped today, following China’s promise to keep its economy growing. However, the rise was restricted, as investors kept a close watch on a cluster of medium-term concerns, rising supplies, the US fiscal crisis and the ongoing crisis in Europe.

Brent crude increased by 52 cents to $110.61 per barrel, while US crude rose by 45 cents to $90.57, reported Reuters.

In the previous session, Brent dropped to $109.58, the lowest since 17 January, while US crude declined to $89.33 per barrel, its lowest since 26 December.

On Tuesday, prior to the country’s annual parliamentary meetings, Chinese outgoing premier Wen Jiabao said that the nation will boost fiscal spending in 2013 to drive economic growth at 7.5%.

China’s two PMI showed that factory and services growth slowed to multimonth lows, indicating modest growth in the economy.

"Chinese outgoing premier Wen Jiabao said that the nation will boost fiscal spending in 2013 to drive economic growth at 7.5%."

The estimated $85bn automatic spending cuts that came into effect in US on Friday cast a shadow of doubt over the growth forecast in the world’s largest economy.

Investors are now looking ahead to the US non-farm payrolls data, which is expected to be released this week, to get a further indication on progress of the US economy and futures of the Federal Reserve’s fiscal easing programme.

A survey last week showed that output from the Organization of the Petroleum Exporting Countries (OPEC) rose in February, for the first time in four months.

On the other hand, traders speculate that tensions in the Middle East, particularly between Israel and Iran over the latter’s disputed nuclear programme and the ongoing civil war in Syria and Egypt, are likely to support prices in the long run.

Energy