Crude oil surged above $81 a barrel for the first time since May as a rally in global equity markets increased speculation the economy is strengthening.Oil jumped as much as 3.6 percent after equities climbed on better-than-expected earnings and the Institute for Supply Management's U.S. manufacturing gauge fell less than forecast. The dollar dropped against the euro, boosting the investment appeal of commodities.
Crude for September delivery rose $2.44, or 3.1 percent, to $81.39 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Earlier, it touched $81.77, the highest price since May 5. Futures climbed 4.4 percent in July, the biggest monthly gain since March. Prices are up 17 percent from a year ago.
The Standard & Poor's 500 Index increased 2 percent to 1,123.86 following positive earnings reports from companies such as Humana Inc. and Oshkosh Corp. It jumped 6.9 percent in July, the biggest monthly advance since July 2009. The Dow Jones Industrial Average strengthened 191.94, or 1.8 percent, to 10,657.88.