Oil is now up to $89 a barrel.
NEW YORK (AP) -- Oil prices surged to a new record of $89 a barrel Wednesday after Turkey's parliament authorized an incursion into northern Iraq in search of Kurdish rebels.
The vote overshadowed a U.S. government report that crude oil and gasoline inventories overall rose more than expected last week. But prices did draw some support from a 200,000 barrel decline in inventories at the closely-watched New York Mercantile Exchange delivery terminal in Cushing, Okla.
Light, sweet crude for November delivery rose $1.09 to $88.69 a barrel on the Nymex after rising to a record $89 earlier.
Oil prices initially fell after the Energy Information Administration reported that crude inventories rose by 1.8 million barrels during the week ended Oct. 12, more than the 1 million barrel increase analysts surveyed by Dow Jones Newswires, on average, had expected.
But prices reversed course and rose after the Turkish parliament vote. Traders worry that any escalation in the conflict between the Kurds and Turkey will cut oil supplies from northern Iraq. Despite the decision, Turkey's government said an incursion into Iraq isn't imminent.
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