The price of oil rose Wednesday afternoon following the announcement of a cease-fire agreement to end a week of fighting between Israel and Hamas militants. 

Benchmark West Texas Intermediate crude rose 63 cents to finish at $87.38 US a barrel in New York after having climbed as high as $87.89 in morning trading, after an explosion on a bus injured 27 people in Tel Aviv.

Oil fell nearly three per cent Tuesday.

The truce was announced by Egypt's foreign minister and confirmed by Israeli Prime Minister Benjamin Netanyahu.

The deal is to end a week of fighting that has killed more than 140 Palestinians and five Israelis.

Brent crude, used to price international varieties of oil, rose $1.03 to end at $110.86 a barrel in London.