Cold US weather and hot tempers in the Middle East pushed up world energy futures prices Monday.
The November contract for benchmark US light, sweet crude jumped $1 to $31.86/bbl on the New York Mercantile Exchange, while the December contract gained 94� to $31.85/bbl.
US traders reportedly were primarily concerned that the escalation of political tensions in the Middle East could disrupt oil supplies from that region. In after-hours trading, oil prices continued climbing to $32.27/bbl for November and $32.13/bbl for December.
But the cold wave blowing through the northeastern US market also boosted the November contract for home heating oil by 2.55� to 95.49�/gal on the NYMEX. US refineries are continuing to produce at near capacity, but probably will be unable to produce enough heating oil to meet demand this winter, said energy analysts.
Unleaded gasoline for November delivery also increased by 2.41� to 86.91�/gal on the NYMEX. The November contract for natural gas was up 14.2� to $5.15/Mcf.
In London, the November contract for North Sea Brent crude surged toward the next resistance level of $31/bbl on the International Petroleum Exchange, primarily on the strength of US cold weather, analysts reported.
The November contract for North Sea Brent was up 66� to $30.76/bbl, while the December contract gained 78� to $31/bbl. The November contract for natural gas rose the equivalent of 33� to close at $3.95/Mcf on the IPE.
London brokers were reacting to historically low US stocks going into this winter, despite the release of emergency oil supplies from the Strategic Petroleum Reserve and recent hikes in production by the Organization of the Petroleum Exporting Countries. However, if the current cold snap were short-lived, they said, oil prices would settle back below $30/bbl.
Trading was low Monday because of the Columbus Day holiday in the US and a holiday in some parts of Europe.
The average price for OPEC's basket of seven crudes gained 69� to $29.44/bbl.
