Frigid Temps Boost Gas Prices

Fuel prices were moving higher Monday as a blast of Arctic cold swept across the Northeast, increasing demand for heat.

Near-dated contracts for natural gas were gaining 15 cents at $7.63 per million British thermal units on the New York Mercantile Exchange. Heating oil was up slightly at $1.69 a gallon.

Gasoline was off a penny at $1.56 a gallon, and light sweet crude oil was tacking on 15 cents to $59.17 a barrel.

Temperatures around New York City were recently about 14 degrees Fahrenheit and are expected to warm only slightly later in the week.

"Most forecasters seem to think temperatures will be below normal through the end of February," says Adam Sieminski, chief energy economist at Deutsche Bank in New York. "The higher prices will last for as long as it's cold," as more fuel is consumed to heat dwellings and businesses.

He adds that the planned production cuts by oil cartel OPEC have been taking oil off the market and helping to buoy prices.

In an effort to keep prices from sliding, OPEC mandated that member countries cut back production by a total of 500,000 barrels a day starting this month, on top of 1.2 million barrels late last year. But not all observers are as convinced as Sieminski.