Oil prices heat up as US shivers

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Oil prices heat up as US shivers

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As much of the United States suffers a wave of colder weather, and with more low temperatures forecast, oil has hit its highest in five weeks, for a brief time it was above $79 a barrel.

Prices have also been boosted by signs of recovery, such as last week’s improved jobs figures in the US and this week’s return to growth in profits at Chinese industrial companies.

All of that increases the outlook for fuel demand.

As a consequence, oil prices have risen more than 12 percent after dipping below $70 a barrel a couple of weeks ago.

For the whole year they are up by 75 percent, the biggest annual increase in a decade.

And some traders are predicting oil will end the year above $80.

Falling inventories also have indicated improved demand.

A US government report last week revealed a larger than expected fall in crude stocks, which declined by five million barrels.

Further figures, to be released later this week by the US Energy Information Administration, will show whether that trend is continuing.