Oil prices rise on colder weather
November 22, 2005
Oil prices were pushed higher on Monday as a winter storm began to hit the north-eastern states of the US at the start of Thanksgiving week.
The price of a barrel of US light crude was up 49 cents to $57.70 on the New York Mercantile Exchange, while London Brent crude was up 46 cents at $55.34.
The US North East is the world's biggest heating oil market and higher consumption quickly lifts crude prices.
Analysts are unsure if the region's heating oil stocks are now sufficient.
Supply concerns
Ahead of a predicted harsh winter in the US, some say supplies will meet demand, while others suggest the government needs to start building up stockpiles to prevent supply pressures and knock-on price surges.
"The market was pricing mild, mild, mild and now winter is here and the market has rallied on that," said Deborah White, senior energy analyst at SG Commodities in Paris.
Meanwhile, Saudi Arabia - the world's largest crude producer - said the world needs a better system to more accurately match crude consumption with supply.
It also blamed excessive and inaccurate speculation for this year's volatile oil prices.
Oil hit a high of $70.85 a barrel at the end of August, after Hurricane Katrina damaged oil facilities in the Gulf of Mexico.
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