THE price of oil finished with a fourth straight weekly gain after rising a penny yesterday.

Benchmark crude for August delivery rose 1 cent to close at US$108.05 a barrel on the New York Mercantile Exchange. Oil gained US$2.10 a barrel this week.

Signs of an improving US economy have helped push the price of oil to the highest level in 16 months. Yesteray, oil rose to US$109.32, the highest price since March 1, 2012, before pulling back.

Oil has jumped 15 percent since June 21, when it traded at US$93.69, and has pulled up the price of gasoline along with it. Gasoline futures have gained 13 percent in the same period.

Oil prices have gained support from improved hiring and manufacturing activity in the US A sharp drop in the nation's crude oil supply, signaling an increase in demand, has also boosted energy prices.

Recent gains by West Texas Intermediate, or WTI, the US benchmark oil grade traded on the Nymex, have erased the spread to the Brent contract traded in London from over US$13 in April. Brent crude, the benchmark for many international types of oil, was down 63 cents to finish at US$108.07 a barrel on the ICE Futures exchange.

Analysts say the US benchmark appears overpriced at the current level, but caution against betting on a near-term drop.

Jim Ritterbusch, president of Ritterbusch and Associates, calls levels above US$106 a "mispriced high" considering that US demand growth is a modest 0.5 percent while US crude production is up 15 percent year over year. But he says that's no guarantee the price will decline.

In other energy futures trading on the Nymex:

- Wholesale gasoline added 1 cent to end at US$3.12 a gallon.

- Heating oil fell 1 cent to finish at US$3.09 a gallon.

- Natural gas fell 2 cents to end at US$3.79 per 1,000 cubic feet.