West Texas Intermediate crude rose after TransCanada Corp. said it expects to finish construction and begin commissioning the southern portion of its Keystone pipeline expansion by end of October.

The spread between WTI and Brent oil, the European benchmark, narrowed on speculation that completion of the link will help reduce stockpiles at Cushing, Oklahoma, the delivery point for the WTI contract. The 700,000-barrel-a-day pipeline will run to the Texas Gulf Coast from Cushing. Futures extended gains after a government report showed that stockpiles at the hub fell to the lowest level since February, 2012.

WTI crude for November delivery rose $1.49, or 1.5 percent, to $103.53 a barrel at 11:31 a.m. on the New York Mercantile Exchange. The contract slid 0.3 percent to settle at $102.04 yesterday, the lowest close since July 3. The volume of all futures traded was 61 percent above the 100-day average.

Brent oil for November settlement gained 94 cents, or 0.9 percent, to $108.88 a barrel on the London-based ICE Futures Europe exchange. Volume was 3.3 percent lower than the 100-day average. The European benchmark traded at a $5.35 premium to WTI, down from $5.90 yesterday.

Gold prices rebounded from a two-month low amid a weakening dollar and stronger euro .

The European single currency rose after ECB President Mario Draghi said that the stoppage of work of the U.S. government is a threat to the recovery of the U.S. and global economies.

Draghi said that in his possession is " a number of" tools ready for use , if necessary, to support the European economy. But , in spite of the fact that Draghi called dynamic European economy " weak , uneven and unstable ," he declared about any new stimulus measures , such as providing more cheap loans to banks to spur lending and spending.

On Tuesday, the U.S. government suspended its work because of the differences in the budget , which led to the closure of some of the administrative agencies and the provision of unpaid leave almost a million civil servants.

Draghi reiterated his recent comments that the ECB intends to open another long-term line of credit to banks if the interest rates at which banks lend to each other, will exceed the levels which , in the opinion of the ECB, are appropriate.

The cost of the October gold futures on COMEX today rose to $ 1321.00 per ounce.

GOLD 1,290.30 -36.20 -2.73%

OIL (WTI) 101.83 -0.50 -0.49%