Oil prices climbed briefly to a one-month high above $60 a barrel on Monday as cold weather swept into the US Northeast, boosting demand in the world''s biggest heating oil market.
Reassurances from the Organisation of Petroleum Exporting Countries that it will carry on pumping at close to capacity limited the gains. The group will meet in Kuwait on December 12 to discuss output policy.
US crude settled up 59 cents to $59.91 a barrel after soaring as high as $60.80, the highest since November 4. Prices are up about $5 since November 30 as cold weather ended a long stretch of unusual warmth in the Northeast.
London Brent was up 68 cents at $57.73.
"We''re trading on the weather. It''s cold in New York, so the price is going up," said analyst Mike Wittner of Calyon. Temperatures have fallen below average in the US Northeast and are expected to stay there throughout the week.
Some forecasters have predicted the cold snap could last until the middle of the month, driving up demand for heating oil and potentially eroding US stockpiles that are so far 12 percent higher than a year ago.
Supporting gains, a pipeline supplying Venezuela''s Amuay-Cardon refinery was damaged by an explosion and fire that government officials on Sunday blamed on sabotage, but exports were not affected.
Energy Minister Rafael Ramirez said both damaged lines of the oil route carrying a total of 400,000 barrels per day (bpd) to the plant, the largest in the Western Hemisphere, should resume operations over the next five days.
Crude prices are still well below the record of $70.85 for US crude touched at the end of August in the immediate aftermath of hurricane damage to oil infrastructure.
Opec ministers have said they are happy with current market prices and that they see little need to reduce supplies.
The latest Opec member to reassure the market was Iran, whose new nominee for oil minister, current caretaker Kazem Vaziri-Hamaneh, told reporters: "Stabilizing current prices is desirable."
His comments reinforced those of Opec President Sheikh Ahmad al-Fahd al-Sabah, who said last week the group might keep pumping at current levels of around 30 million barrels per day until March.
SYDNEY: Oil pushed towards $60 a barrel on Monday amid prospects for a cold December on the US Northeast, spurring a rebound in demand for heating oil.
Crude extended last week''s rally to its highest in almost four weeks, despite signs that the Organisation of the Petroleum Exporting Countries (Opec) will decide next week to carry on pumping oil at near its full capacity. January crude was up 52 cents or 0.9 percent at $59.84 a barrel, its highest since November 9, as it builds on gains of 5 percent over the final three days of last week.