US oil settles at $60.40 a barrel, highest since December

Expect another oil selloff: Pro
Expect another oil selloff: Pro
Al-Naimi: Nobody knows the oil price, except Allah
Al-Naimi: Nobody knows the oil price, except Allah
Saudi oil min: Not worried about oil price
Saudi oil min: Not worried about oil price

Oil prices closed at 2015 highs on Tuesday after protests stopped crude flows to the eastern Libyan oil port of Zueitina, hampering exports.

U.S. crude oil closed up up $1.47, or 2.49 percent, at $60.40 a barrel. That was its highest settle since December 10. climbed to a high of $68.40 a barrel its highest since December. The contract last traded at $67.50, up $1.05.

Oil was also supported by news that Saudi Arabia had raised its official selling prices for its Arab Light grade crude to the United States and Northwest Europe, pointing to strong demand in those regions.

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"Higher OSPs for Europe and the United States seem to point to healthy demand for Saudi oil," Carsten Fritsch, senior oil analyst at Commerzbank in Frankfurt, told Reuters Global Oil Forum.

David Einhorn: Fracking burns cash
David Einhorn: Fracking burns cash

Zueitina is one of the few Libyan ports still exporting oil as many others have closed due to fighting or disruptions at oilfields since the ousting of former dictator Muammar Gaddafi.

Libyan oil output is below 500,000 barrels per day (bpd), officials say, a third of what the country pumped before 2010.

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Investors have moved heavily into oil over the last few weeks as prices have recovered from a slump in January. Crude prices have now risen 50 percent in just over three months.

Hedge funds and money managers raised bets on rising Brent prices to another record, data showed on Monday, pushing net long positions to their highest since official exchange records began in 2011.

Civil war in Yemen has kept the oil market on edge, underpinning prices due to the risk of disruption to oil supplies from its northern neighbor, Saudi Arabia, or other Middle East Gulf producers.

The oil market is well supplied, with producers of the Organization of the Petroleum Exporting Countries pumping almost 2 million bpd more than demand for their oil.

OPEC meets next month to discuss production policy but analysts see little chance that it will restrain output as members battle for market share.

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Investors awaited data on U.S. commercial crude oil stocks.

A Reuters poll on Monday said commercial crude stocks may have risen by nearly 2 million barrels last week, building for a record 17th straight week.

The U.S. Energy Information Administration will publish it official report on U.S. oil inventories on Wednesday.