Oil prices advance on expected drop in US stocks

December 29, 2010 | 08:00

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Oil prices moved higher on Tuesday on expectations of a fall in US stocks at a time of cold weather in heavy energy consuming regions of the United States and Europe.

In London electronic exchanges a barrel of Brent North Sea crude for February delivery was up 40 cents to $93.86 on the InterContinental Exchange compared with close of trade on Friday.

The London oil market was closed on Tuesday for the second day of a long holiday weekend, with only electronic trading providing an indication of price movement.

In early electronic trade on the New York Mercantile Exchange, a barrel of light sweet crude for February delivery was up 16 cents at $91.16.

Analysts said blizzards battering the US northeast and eastern Canada point to a draw-down in US petroleum stocks this week as crude oil is transformed into heating fuel.

At the same time cold weather is continuing in Europe.

US reserves fell by about 15 million barrels in the first half of December in the face of brisk demand and end-of-the year inventory adjustments by refiners.

New figures on US stocks are to be published on Thursday.

AFP

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