West Texas Intermediate crude headed for a fifth weekly gain as cold weather in the U.S. bolstered demand for energy in the world’s biggest oil consumer.
Futures were little changed in New York while poised for the longest weekly rally in a year. Distillate inventories, a category that includes heating oil and diesel, last week dropped to the lowest level for that time of the year since 2003, according to the Energy Information Administration. January was the coldest start to the year in more than a decade and more snow is sweeping across the U.S. Northeast. Libyan output decreased after protesters closed a pipeline, a government official said.
“I expect the firm tone to continue, certainly the cold weather demand is one of the underpinning factors,” said Michael McCarthy, a chief strategist at CMC Markets in Sydney who predicts investors may sell WTI contracts at about $100.50 a barrel. “There’s now consensus emerging that over the medium to longer term we’re looking at higher oil prices.”
WTI for March delivery was at $100.20 a barrel, down 15 cents, in electronic trading on the New YorkMercantile Exchange at 11:34 a.m. Sydney time. The contract is up 0.3 percent this week, heading for the longest rising streak since February 2013. The volume of all futures traded was about 18 percent below the 100-day average.
Brent for March settlement expired yesterday after dropping 6 cents to $108.73 a barrel on the London-based ICE Futures Europe exchange. The more-active April contract rose 17 cents to close at $108.52. The front-month European benchmark crude ended the session at a premium of $8.38 to WTI.