SINGAPORE (Bloomberg) -- Crude oil rose in New York, paring the worst weekly decline since December, after equities gained on speculation governments will widen efforts to help consumers weather a deepening global recession.

Oil climbed as much as 2.7 percent as European equity markets advanced. President Barack Obama may use government money to help cut mortgage interest rates, according to a person briefed on the plan. China’s economy may expand 6.6 percent in the second quarter after slowing to 6.3 percent in the three months to March 31, according to a Bloomberg survey.
“Equities are lending some support to oil,” said Carsten Fritsch, an analyst with Commerzbank AG in Frankfurt. “It may be there’s some optimism coming back into the market from the stimulus package, and a feeling that markets came down too far.”
Crude oil for March delivery rose as much as 92 cents to $34.90 a barrel on the New York Mercantile Exchange. It was at $34.77 a barrel at 9:31 a.m. London time. On Thursday, futures fell $1.96, or 5.5 percent, to $33.98, the lowest settlement since Dec. 19. It was the fifth consecutive daily decline.
The MSCI World Index climbed for the first time in four days, adding 0.8 percent to 844.61 as of 8:18 a.m. in London. Barclays Plc, the U.K.’s third-biggest bank, and ING Groep NV gained more than 2 percent.
---------------Supply glut
Crude prices are still down 14 percent this week, the biggest weekly slump since the week of Dec. 19. Oil has fallen 22 percent this year and 63 percent from a year earlier.
World oil consumption will drop 1.7 percent to 84.3 million barrels a day this year, consultant Wood Mackenzie said in a report on Thursday. The Energy Department and International Energy Agency cut their demand forecasts earlier this week.
“Oil consumption has weakened fairly dramatically, and in certain parts of the U.S. we have very high inventories,” said David Moore, a commodity strategist with Commonwealth Bank of Australia Ltd. in Sydney. “We’re going to have to work through those first but with consumption as weak as it’s been, that’s going to take some time.”
The discount of the March West Texas Intermediate contract, the grade that’s traded in New York, to London’s Brent future for the same month widened to a record $11.55 a barrel on Friday after supplies at Cushing, Oklahoma, rose.
------------Brent rises
Brent increased after Royal Dutch Shell Plc said it may miss deliveries of oil from Nigeria because of security concerns. March futures expired on Thursday.
The new prompt-month April contract was at $47.83 a barrel, $1.80 higher, on the ICE Futures Europe exchange at 9:32 a.m. London time. The contract gained 71 cents, or 1.6 percent, on Thursday.
Supplies at Cushing, where WTI is stored, climbed 1.7 percent to 34.9 million barrels last week, the highest since at least April 2004, when the department began keeping records for the location.
Prices for delivery in future months are higher than for earlier ones, a situation known as contango, allowing buyers to profit from hoarding oil. The price of oil for delivery in April is more than $7 a barrel higher than for March. December futures are more than $19 higher from the front month.