Oil prices rose Thursday on hopes that the European economy would recover with the help of an interest rate cut.

In New York, benchmark crude rose 37 cents to $92.88 per barrel in morning trading. Bent crude rose 41 cents to $109.75 a barrel in London.

In a move that surprised markets, the European Central Bank cut its benchmark interest rate to 1.25 percent from 1.5 percent. The aimed is to keep European economies from falling into recession. Stock markets in Europe and the U.S. rose sharply on the news.

Low interest rates make it cheaper for businesses to borrow money to invest in new factories, materials, technology and jobs. When economies grow, demand for gasoline, diesel and jet fuel rises as people travel more and businesses ship more goods.

Copyright 2011 The Associated Press.