U.S. News

Oil rises above $61 on cold weather forecasts

Oil prices hovered around $61 a barrel Wednesday as the market considered forecasts for colder weather in the United States and next month's OPEC meeting.

In less than two weeks, the front-month crude-oil futures contract has climbed by more than $5 a barrel, but prices are still trading within a range that has been roughly in place since the start of October.

Oil traders' focus is on supply, with just two weeks before a meeting of the Organization of Petroleum Exporting Countries and the approach of the Northern Hemisphere peak demand period. They were also watching for Wednesday's weekly U.S. government data release, which is expected to show across-the-board inventory gains.

Light sweet crude for January delivery was up 11 cents to $61.10 a barrel in afternoon Asian electronic trading on the New York Mercantile Exchange.

Barely two weeks ago, on Nov. 17, the December contract settled and expired at $55.81 a barrel.

January Brent crude at London's ICE Futures exchange rose 9 cents to $61.30 a barrel.

Prices have been rising this week after London-based newspaper Al-Hayat reported Monday that Saudi Oil Minister Ali al-Naimi had indicated that OPEC would evaluate the effect of October's decision to cut output when it meets next month in Abuja, Nigeria, and if necessary authorize another cut.

OPEC announced in mid-October that it would reduce output by 1.2 million barrels a day, but skepticism that the cartel members are committed to production cuts, as well as milder-than-normal U.S. temperatures this fall, have moderated prices.

Traders were also focused on reports that called for wintry U.S. weather in the West to gradually move to the East by the end of the week.

Oil prices have fallen by about 23 percent since hitting an all-time trading high above $78 a barrel in mid-July. They haven't settled above $62 a barrel since Oct. 1.

In other Nymex trading, heating oil futures gained 0.27 cent to $1.7310 per gallon and natural gas futures rose 0.2 cents to $8.561 per 1,000 cubic feet.