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Oil up near $80 after US crude stockpiles fall

Oil up near $80 after US crude stockpiles fall

Oil prices rose to near $80 a barrel on the final day of the year Thursday after U.S. crude stockpiles fell for the fourth week in a row.
By early afternoon in Europe, benchmark crude for February delivery was up 47 cents at $79.75 a barrel in electronic trading on the New York Mercantile Exchange, its seventh straight session of gains. On Wednesday, the contract added 41 cents to settle at $79.28.
The Energy Information Administration said U.S. crude supplies shrank by 1.5 million barrels last week, less than the expected drop of 2.2 million barrels. Gasoline supplies also fell.
The drop in inventories isn't necessarily a sign of fundamental improvement in demand for crude though.
It is typical to see crude draws at this time of year because many companies empty out storage facilities for tax purposes. While supplies have fallen nearly 14 million barrels over the past four weeks, they remain relatively high compared with past years.
Oil prices have more than doubled from their crisis lows of a year ago, and most analysts are forecasting crude will average between $75 and $85 in 2010.
Experts said the Organization of Petroleum Exporting Countries, OPEC, would be "well advised" to ensure that its members _ many of whom have exceeded their agreed-to output levels to capitalize on higher oil prices _ stick more closely to their production quotas next year.
"Otherwise, if hopes of a quick recovery are not fulfilled, market participants should focus more again on fundamentals (high stock levels) and with this, prices could come under considerable pressure," said Vienna's JBC Energy.
OPEC's 12 members, including Saudi Arabia, Venezuela and Nigeria, supply about 55 percent of the world's oil exports.
In other Nymex trading in January contracts, heating oil rose 1.25 cents to $2.1218 a gallon and gasoline advanced 0.94 cent to $2.05 a gallon. The February contract for natural gas gained 7.1 cents to $5.78 per 1,000 cubic feet.
In London, Brent crude for February delivery rose 35 cents to $78.38 a barrel on the ICE Futures exchange.
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AP Energy Writer Chris Kahn contributed to this story.


Updated : 2021-04-13 16:33 GMT+08:00