Oil advanced to a two-month high in New York

Oil advanced to a two-month high in New York and the dollar slipped against the euro as President Barack Obama plans to leave for Washington to resume talks to avert spending cuts and tax gains that threaten the economy.

Crude rose as much as 3 percent and the dollar approached an eight-month low against the euro before lawmakers return to discuss ways to avoid more than $600 billion in automatic measures that will take effect Jan. 1. Gains accelerated after United Arab Emirates’ security forces arrested members of a cell that was planning to carry out terrorist attacks.

Obama plans to leave for Washington today from his Christmas vacation in Hawaii, while his family will stay behind, the White House said yesterday. Lawmakers plan to return tomorrow, the same day Obama will arrive in Washington.

UAE officials said members of the group had obtained equipment and materials to carry out their attacks, according to WAM, the country’s official news agency. Saudi Arabia assisted in uncovering the terrorist cell, WAM said.

Crude oil for February delivery climbed to $91.30 a barrel, the highest level in two months on the New York Mercantile Exchange.

Brent oil for February settlement rose $1.75, or 1.6 percent, to $110.55 a barrel on the London-based ICE Futures Europe. The number of contracts trading was 73 percent lower than the 100-day average. The European benchmark crude was at a premium of $19.67 to WTI, down from $20.19 on Dec. 24.