TOKYO, Dec 18 (Reuters) - U.S. crude futures rose for a
third day on Tuesday on hopes that Washington could be edging
closer to a deal to avert the so-called fiscal cliff, which
threatens to push the world's biggest oil user into recession
and dent energy demand.
FUNDAMENTALS
* NYMEX crude for January delivery was up 20 cents at
$87.40 a barrel by 0004 GMT, after settling up 47 cents at
$87.20 on Monday.
* The discount of U.S. crude to Brent narrowed by $1 on
Monday, following news of the expansion of a key U.S. pipeline
next month that would allow more crude to be transported to the
Gulf Coast from the Cushing, Oklahoma delivery point, where a
glut of oil has depressed U.S. oil prices.
* London Brent crude for February delivery was yet
to trade, after settling down 54 cents at $107.64.
* U.S. stock markets and oil futures got support on Monday
after investors saw a meeting between President Barack Obama and
Republican John Boehner as a sign of progress that an agreement
on a "fiscal cliff" deal was shaping up.
* A pipeline leak that spilled more than 2,000 gallons of
gasoline from Buckeye Pipe Line Co's 140,000 barrels-per-day
refined products line was sealed and stopped, New Jersey
regulators said on Monday.
* Manufacturing in New York State declined for a fifth
straight month in December and the labour market remained weak,
the New York Federal Reserve said in a report released on
Monday.
* Ahead of a weekly oil report by the American Petroleum
Institute later in the day, a Reuters poll of analysts forecast
the data would show a drawdown in crude oil stocks last week as
refiners ran down inventories for year-end tax purposes, while
fuel stockpiles were expected to show a corresponding build.
MARKETS NEWS
* The S&P 500 ended at its highest level in almost two
months on Monday.
* The yen dropped to a 20-month low against the U.S. dollar
on Monday after Japan's Liberal Democratic Party won a landslide
election victory that leaders promise will usher in aggressive
monetary easing policies to weaken the currency.
DATA/EVENTS
* The following data is expected on Tuesday: (Time in GMT)
- 1245 U.S. ICSC chain stores
- 1330 U.S. Current account/Q3
- 1355 U.S. Redbook
- 1500 U.S. NAHB housing market index/Dec
- 2130 American Petroleum Institute oil report
- 2300 U.S. SEMI Book-to-bill ratio/Nov
(Reporting by Osamu Tsukimori; Editing by Joseph Radford)