Oil hovers around 58

Oil prices meander below $58 a barrelNEW YORK (AFX) - Oil prices wavered below $58 a barrel Thursday, as energy traders struggled to find direction in a market that has risen sharply over the past two weeks on arctic U.S. weather, but has been unable to surpass the $60 mark.Many analysts are saying that oil prices have become mired in a range between about $56 and $60 a barrel; factors such as violence in Nigeria, growing tensions in Iran, and low temperatures are keeping prices afloat, but abundant global supplies and the belief that U.S. heating fuel demand can't get any higher are reining them in.Crude prices dropped more than a dollar Wednesday after the U.S. Department of Energy's weekly inventory report showed that last week, daily distillate demand averaged 4.3 million barrels, below most analyst expectations.Light, sweet crude for March delivery rose 15 cents to $57.86 a barrel in late morning trading on the New York Mercantile Exchange, after rising as high as $58.42 and slipping as low as $57.30.The daily volatility in trading "shows that the market is still solidly in the $56-$60 range," said Victor Shum, an energy analyst with Purvin & Gurtz in Singapore.Shum said the continued kidnappings in Nigeria and increasing tensions between Iran and the United States over the Iranian nuclear program were "a reminder to the oil market that geopolitical tensions are lurking," but were not strong enough factors to leap above the psychological barrier of $60.Meanwhile, natural gas prices rose slightly Thursday, after the Energy Department said 224 billion cubic feet of natural gas were taken out of underground storage last week -- around what most analysts were expecting. Total natural gas in storage stands at 2.571 trillion cubic feet, about 8 percent above where it was a year ago.Nymex natural gas rose 8.6 cents to $7.795 per 1,000 cubic feet.The price of natural gas, the more popular form of home heating in the United States, has risen more than 60 percent over the past month on recent cold weather. They are trading around the same levels they were this time last year.Bitterly cold weather recently in the Northeast -- which represents 80 percent of the nation's heating oil demand -- has also helped lift crude prices 19 percent since Jan. 18, when crude touched a 20-month low of $49.90.The National Oceanic and Atmospheric Administration continues to forecast below-normal temperatures across the Northeast until at least Feb. 19.Traders have not sent prices above $60 a barrel since the first trading day of the year.According to Cameron Hanover's Peter Beutel, the best hope for traders betting on rising prices is that next week's inventory data could show a record figure for distillate demand and a larger decrease in distillate stockpiles."The problem, now, though, is that traders may do a lot of selling between now and then, and that could leave us substantially lower by the time next week's figures are released. Yesterday's inability to break $60 is going to give the sellers the initiative," Beutel wrote.March Brent crude at London's ICE Futures exchange fell 29 cents to $56.94 a barrel.In other Nymex trading Thursday, heating oil rose 1.29 cent to $1.6790 a gallon, and gasoline rose less than a cent to $1.5475 a gallon.