Crude prices boosted by falling US energy reserves

World oil prices climbed on Thursday in the wake of a larger-than-expected drop in US crude inventories, traders said. In London, Brent North Sea crude for February delivery gained 57 cents to 91.81 dollars per barrel. New York's main contract, light sweet crude for February, rose 46 cents to 91.94 dollars per barrel.
"Crude futures were firmer (on Thursday), still underpinned by a sharp fall in US crude inventories last week," said Andrey Kryuchenkov, an analyst at the Sucden brokerage in London. The US Department of Energy said Wednesday that stockpiles of US crude tumbled by 7.6 million barrels in the week ended December 14. That was far heavier than market expectations for a drop of only 1.5 million barrels.
The DoE also reported that distillates, which include heating fuel, fell by 2.1 million barrels last week. Traders are concerned over the level of heating fuel stockpiles as colder winter weather has hit the United States in recent days and weeks.
At the same time, the market was haunted this week by fears over future global economic growth amid the ongoing global credit crunch. "Market participants are worrying that a potential slow down or a recession in the US or global economies could reduce demand for energy," Kryuchenkov added. "So investors still remain focused on the economic outlook, which seems to dominate headlines at the moment.
"However, trade remains subdued due to the approaching holiday season."
This week, prices were also pressured by geopolitical concerns in crude producer Iraq. Prices sank on Tuesday, reversing an earlier spike, as traders reacted to a move by Turkish troops into northern Iraq to flush out Kurdish rebels-and their subsequent quick withdrawal. About 300 Turkish troops entered northern Iraq on Tuesday in the first ground incursion targeting Kurdish rebels since tensions between Ankara and Baghdad erupted over the rebel issue in October.
Hours later, the head of Iraq's Kurdish government said Turkish troops had begun pulling back.
Crude oil prices had surged to a record high of 99.29 dollars a barrel on November 21, which led to widespread calls for Opec to hike output at its meeting in Abu Dhabi earlier this month. However the Organisation of the Petroleum Exporting Countries (Opec) opted against increasing production, and insisted that the market was awash with adequate crude oil supplies.