Oil Briefly Tops $100 as Demand for Fuel Rises
NEW YORK (AP) — The price of oil briefly rose above $100 a barrel Friday for the first time this year on rising demand for fuel and some positive sentiment about the U.S. job market.
Benchmark U.S. crude for March delivery gained $2.04, or 2.1 percent, to close at $99.88 a barrel the New York Mercantile Exchange. Oil climbed above $100 in the afternoon before dropping back. Oil last topped $100 on Dec. 30.
Energy analyst Stephen Schork said oil's rise was brought about by rising prices for wholesale gasoline and low supplies of diesel and heating oil. That combination will encourage refiners to buy and process more crude oil.
"It's a function of a products pulling crude," he said. "The market needs product."
Heating oil supplies have declined as a cold and snowy winter has homeowners constantly cranking up the thermostat. The Energy Department said Wednesday that supplies of distillates, which include heating oil and diesel, fell by 2.4 million barrels last week and are now 12 percent below year-ago levels. Heating oil futures gained 6 cents to $3.05 a gallon.
While some U.S. drivers have stayed indoors this winter, gasoline demand is turning out to be stronger than expected, Schork said.
Wholesale gasoline futures increased 7 cents to $2.75 and gained 15 cents, or 6 percent over the last three days.
Oil was also pulled higher by a sharp rise in the U.S. stock market. While the Labor Department's jobs report showed a relatively weak number of new jobs, the number of people in the job market rose, suggesting that people are feeling better about their prospects and that hiring was depressed by the bad weather. In mid-afternoon trading, the Dow Jones industrial average was up 154 points, or 1 percent.
Natural gas again fell sharply amid predictions of milder weather for the Midwest and Northeast. The price fell 15 cents, or 3 percent, to $4.78 per 1,000 cubic feet, bringing the two-day decline to 25 cents, or 5 percent.
Brent crude, used to set prices for international varieties of crude, rose $2.38, or 2.2 percent, to $109.57a barrel on the ICE Futures exchange in London, the highest close since Dec. 31.
Christopher S. Rugaber in Washington and Pablo Gorondi in Budapest contributed to this story.
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