Oil Rises From Two-Day Low as China Pledges Help on Europe Debt

Oil rose after China pledged to help resolve Europe’s debt crisis, easing concern that economic growth will slow and curb fuel demand. Brent crude may advance to $120 a barrel, according to Goldman Sachs Group Inc.

Crude futures in New York increased as much as 1 percent, rebounding from a two-day low. China will invest in Europe’s bailout funds, the nation’s central bank governor Zhou Xiaochuan said in Beijing. European Union finance ministers will today prod Greece to deliver budget cuts in exchange for a second aid package. The world’s oil market is increasingly vulnerable to rising prices as spare production capacity declines, Goldman Sachs said.