Oil rises but still below 126 dollars

LONDON  - Oil prices rose slightly on Thursday, as Libya said it would halt fuel supplies to key energy client Switzerland amid a diplomatic row between the two countries.

Libya is a member of the OPEC, the cartel that supplies about 40 percent of the world’s crude oil.

Crude futures were meanwhile rising a day after slumping by about four dollars a barrel after a bigger-than-expected increase in US gasoline reserves amid weaker demand in the United States, the world’s biggest energy consumer.

“Given the huge fall recently, there has been increasing talk the oil prices may have peaked,” said Sucden analyst Michael Davies.

New York’s main contract, light sweet crude for September delivery, rose by 66 cents to 125.10 dollars a barrel in electronic deals on Thursday. Brent North Sea crude for September delivery climbed 58 cents to $125.87 in early London trading.