Oil Gains Towards $79

Oil prices gained 2.2% towards $79 a barrel today after China agreed to allow a flexible yuan exchange rate, raising expectations of higher petroleum imports by the country.

For July delivery, US crude gained $1.66 to stand at $78.84 at 02.57 ET, while London Brent crude for August rose $1.64 to $79.86 a barrel, according to Reuters.

China announced it would resume making the yuan flexible, which might make Chinese imports of dollar-denominated oil cheaper, thereby increasing energy consumption.

US crude has recovered about 21% from $65 a month ago, but is still approximately $9 lower than the 2010 high.