Oil prices hovered below $92 a barrel Tuesday in Asia near a two-year high as a stock market rally to start 2011 boosted crude trader optimism.

Benchmark oil for February delivery rose 7 cents to $91.62 a barrel midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose 17 cents to settle at $91.55 on Monday.

U.S. stock markets advanced the first trading day of the year as data showed recent manufacturing activity and construction spending rose more than analysts were predicting.

The S&P 500 stock index gained 1.1 percent Monday and most Asia equity markets rose Tuesday, led by a 1.7 percent jump in Japan's Nikkei 225 index.

Oil investors often look to equities as a barometer of overall investor sentiment.

"This ongoing burst of economic optimism is enhancing the oil market's attractiveness as an asset class," Ritterbusch and Associates said in a report. "We look for this momentum to be sustained as long as the stock market maintains a northerly course."

In other Nymex trading in February contracts, heating oil gained 0.7 cent to $2.56 a gallon while gasoline futures rose 0.3 cent to $2.43 per gallon. February natural gas futures fell 0.1 cent to $4.64 per 1,000 cubic feet.

In London, Brent crude rose 16 cents to $95.00 a barrel on the ICE Futures exchange.