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NEW YORK - Oil rose to near US$61 a barrel on Thursday after US government data showed a sharp fall in fuel supplies last week.
US crude settled up 88 cents to US$60.95 a barrel after trading as high as US$61.25 earlier. London Brent crude climbed US$1.27 to
60.62 a barrel.
Inventories of distillate fuels, which include heating oil, fell 5 million barrels last week after frigid weather brought snow and ice storms to the US Northeast, the Energy Information Administration said. Analysts had expected a 2.9 million barrel decline.
"(The numbers) were certainly bullish with the large distillate drawdown reflecting the demand spike on the recent cold snap," said John Kilduff of Fimat USA.
Petrol stockpiles fell 3.1 million barrels last week, compared with forecasts for a 100,000 barrel increase. Crude stocks rose by a larger-than-expected 3.7 million barrels, according to the report.
Adding to bullish sentiment, a string of US refinery problems and other operational snags has raised supply concerns ahead of peak summer driving demand in the world's top energy consumer.
A fire over the weekend at Valero Energy Corp.'s 170,000 bpd refinery on the Texas panhandle was expected to keep the plant shut for several weeks. Several other refineries were shut for repairs and regular seasonal maintenance.
In addition, BP shut its 47,000 bpd Northstar oil field in the Beaufort Sea off Alaska for unplanned repairs that could keep it out of service until next week.
Elsewhere, a pipeline carrying fuel to the densely populated US Northeast was shut this week. The pipeline's operator, TEPPCO Partners LP, has said it could restart the affected portion of the 240,000 barrels per day oil products line by Saturday, if repairs go as planned.
The operational problems come against the backdrop of rising tensions between the United States and Iran over its nuclear programme. A UN deadline for Opec member Iran, the world's No. 4 oil exporter, to halt uranium enrichment work passed on Wednesday.
Tensions are also rising in fellow Opec member Nigeria, ahead of April elections. Militant attacks have already shut a fifth of output.
Opec next meets in Vienna on March 15, where the producer group will probably decide to leave supply levels unchanged, Nigeria's energy minister said on Wednesday.
The group, excluding Iraq and Angola, is on course to trim oil output in February by 500,000 bpd as members led by Saudi Arabia curbed supply further, consultant Petrologistics said on Thursday.
- REUTERS
