Oil jumps after stocks cut into big losses

The price of oil had a sudden burst Monday after the stock market tried to put the brakes on a four-day skid.

Benchmark oil for August delivery rose $1.49 to close at $95.18 a barrel on the New York Mercantile Exchange. Oil sank by $4.55 a barrel, or 4.7 percent, on Thursday and Friday after the Federal Reserve spooked investors by signaling the end of a bond-buying program that has boosted the economy.

Oil fell initially Monday because of growing worries that China's decision to clamp down on informal lending could hamper growth in a major energy consuming country. Oil dropped as low as $92.67 a barrel.

Once stocks clawed back from their lowest levels of the day, oil moved higher, gaining nearly $2 a barrel in two hours. The Dow Jones industrial average fell nearly 250 points in the first half-hour of trading Monday, then finished with a loss of 140 points.

There is better news at the gas pump, where many U.S. drivers are paying less to fill up. The national average for a gallon of gas dropped 4 cents in the past week to $3.57. States where prices had spiked because of refinery outages realized significant relief. The average price in Indiana, Michigan, Ohio and Wisconsin fell more than 20 cents a gallon compared with the previous Monday.

Prices are going the other way in California. The average price rose to $4.07 a gallon from $3.98 a week ago.

Brent crude, which is used to price oil used by many U.S. refineries to make gasoline, rose 25 cents to finish at $101.16 a barrel.

In other energy futures trading on the Nymex:

— Wholesale gasoline lost 2 cents to end at $2.74 a gallon.

— Heating oil rose 1 cent to finish at $2.85 per gallon.

— Natural gas slipped 3 cents to finish at $3.74 per 1,000 cubic feet.

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Pablo Gorondi in Budapest and Pamela Sampson in Bangkok contributed to this report.