Oil

Oil prices settle near $59 a barrelNEW YORK (AFX) - Oil prices edged higher Tuesday, lifted by chilly weather across the Midwest and Northeast United States that is boosting heating fuel demand.Traders expect that the recent cold temperatures will be reflected in the heating oil stockpiles, which the Energy Department will be reporting on Wednesday. The market is predicting a large drop in heating oil stocks, but increases in crude oil and gasoline.Crude prices stayed under the $60-a-barrel mark as the cold weather and dropping heating fuel inventories are mostly priced into the market already, analysts said."If you haven't bought the market already, you've pretty much missed the whole move," said Michael Guido, director of commodity strategy in New York for bank Societe Generale. "It can't get any colder -- all the risk is to the downside. Any kind of breakup in the cold we're getting, and it could easily drop a dollar."Light, sweet crude for March delivery rose 14 cents to settle at $58.88 a barrel on the New York Mercantile Exchange, after rising as high as $59.99 a barrel in electronic trading. The contract on Monday slipped 28 cents to settle at $58.74 a barrel.Oil hasn't closed above $59 a barrel yet this year.A bone-chilling cold wave has been blasting across the northern Plains of the United States to the Northeast, contributing to heavy snowfall and below-zero temperatures as far south as West Virginia. Colder-than-normal temperatures are expected to linger in the Northeast and Midwest through Feb. 19, the National Weather Service said Tuesday.Brent crude on the ICE futures exchange rose 32 cents to settle at $58.42 a barrel Tuesday.In Nymex trading, heating oil futures rose 1.53 cent to finish at $1.6909 a gallon; gasoline prices rose 1.26 cent to settle at $1.5725 a gallon; and natural gas prices slipped 1.8 cent to end at $7.616 per 1,000 cubic feet.Nymex crude oil prices had fallen as low as $49.90 a barrel last month after unseasonably warm weather. But the recent cold spell and ensuing strong demand for heating fuels is expected to result in another big drop in U.S. distillate stocks in Energy Department's weekly petroleum inventories report, which will be released Wednesday.Citing the U.S. National Weather Service, Vienna's PVM Oil Associates said that because U.S. heating oil demand will be around 20 percent above normal next week, prices will likely be supported in the coming days.The government's weekly report on natural gas in storage will be released Thursday. Natural gas is a more common heating fuel than heating oil in the United States, especially in the Midwest.Retail gasoline prices started climbing higher last week, as crude oil prices jumped back to to the high $50s. The average U.S. price for a gallon of regular was $2.181 on Tuesday, up from $2.177 on Monday, according to AAA.Politicals tensions in oil producing nations including Nigeria and Iran have also been instrumental in keeping prices afloat lately, but traders are focusing more on weather in the United States, the world's biggest energy consumer.Militant attacks on oil facilities in the Niger Delta have caused Nigeria, a major supplier of oil to the United States, to slash production. On Tuesday, Nigerian President Olusegun Obasanjo called a high-level meeting scheduled for Thursday to address the recent upswing in violence.Also buoying oil prices over the past week has been stronger-than-expected economic data out of the United States, including last week's gross domestic product data and employment figures."That's renewing the argument for robust demand and good demand growth for '07," said John Kilduff, analyst at Fimat USA.