Italian Prime Minister Silvio Berlusconi is under intense pressure to resign as he faces rebellion from his own party and a no-confidence vote orchestrated by rivals. Greek Prime Minister George Papandreou already has said he is resigning so as to facilitate the creation of a national unity government.
"Supply and demand are taking a backseat to political factors," chief energy economist Adam Sieminski with Deutsche Bank in Washington told Bloomberg. "The current system in Europe is struggling to come to terms with the financial difficulties in Italy, Greece, Portugal and Spain. There's a feeling that a change in political leadership may be the needed answer."
At 3 p.m. on Monday, crude oil futures gained 2.34 percent, a $2.62 increase to $114.59 per barrel.
Reuters reports the focal point of the sovereign debt crisis is being pushed from Greece to Italy as investors cautiously eye developments and their impact on markets.
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