Oil prices gained Friday as falling American new home sales eased the concern that the Federal Reserve will scale back stimulus measures soon.

Sales of new single family houses in July were 394,000 at a seasonally adjusted annual rate, down 13.4 percent from June's revised rate, the U.S. Commerce Department said on Friday.

The weak new home sales data signals that higher mortgage rates may weigh on the housing market. Traders regarded it as an indication that the Federal Reserve may need to wait some time before scaling back its bond-buying program.

Minutes of the Federal Open Market Committee released Wednesday showed broad support for Chairman Ben Bernanke's tapering timeline. Policy makers from the Fed's policy setting arm were "broadly comfortable" with the plan to start trimming down bond buying later this year if the economy improves.

Investors would be looking for any hints about when the Fed will start tapering monetary stimulus from a three-day symposium which is gathering U.S. monetary policy makers as well as some central bankers in the world in Jackson Hole, Wyoming, from Thursday.

The political crisis in Egypt also supported oil prices. Although Egypt is not a major oil producer, it controls the Suez Canal and the Suez-Mediterranean Pipeline, through which a large amount of crude and refined products are shipped between the Red Sea and the Mediterranean.

Light, sweet crude for October delivery gained 1.39 U.S. dollars, or 1.32 percent, to settle at 106.42 dollars a barrel on the New York Mercantile Exchange. Brent crude for October delivery was up 1.14 dollars, or 1.03 percent, to close at 111.04 dollars a barrel.