Updated from 11:02 a.m. EST
Oil prices breached $60 Thursday as traders focused on slimming fuel supplies and an increasing likelihood that OPEC will uniformly trim output this month.
Light, sweet crude, the benchmark contract on the New York Mercantile Exchange, closed at a two-week high of $61.16 a barrel, up $1.33. Heating oil and unleaded gasoline each rose 3 cents, to $1.74 a gallon and $1.60 a gallon, respectively.
Oil prices have risen and fallen this week on whether the Organization of the Petroleum Exporting Countries will uniformly trim production this month. The U.S. Energy Department said in a report on Tuesday that OPEC will only reduce output by less than 800,000 barrels per day, a claim OPEC ministers refuted yesterday.
Traders won't know whom to believe until later this month, or in December, when OPEC oil shipments reach the U.S. OPEC ministers may further trim output on Dec. 14 at their next meeting if oil prices are not high enough.
The group, which controls more than a third of the world's crude, held an emergency meeting in October when oil prices sagged below $60. They agreed to cut output by 1.2 million barrels starting this month and held out hope of further cuts.
Despite OPEC's move, for the time being, there is more than enough supplies to offset any temperature drop. Fuel inventories are 1% to 11% above the same period last year. But once winter temperatures fall, domestic supplies will likely be crimped.
Last week, crude stockpiles rose by 400,000 barrels as refiners cut production for seasonal maintenance. Lower imports also helped shaved supplies of distillates by 2.7 million barrels and gasoline by 600,000 barrels.
Natural gas jumped by 4 cents to $7.95 per million British thermal units after the Energy Department said inventories fell by 7 billion cubic feet. Analysts surveyed by
had expected a decrease of 4 billion cubic feet.
Stockpiles now stand at 3.44 trillion cubic feet or 7% above a year ago and nearly 8% above the five-year average.
Although a new tropical storm was forming off the Mexican coast in the Pacific, Rosa was not expected to touch land, the National Hurricane Center said.
The National Oceanic and Atmospheric Administration said this winter should be warmer than usual in the northern and western parts of the country thanks to El Nino conditions that should last through the spring. El Nino occurs when the waters of the western Pacific warm every few years. The Gulf Coast will likely receive more rain and the Ohio Valley will be dry.
Exploration and refining companies were following crude higher, with the Amex Oil Index up 0.9%.
were rising as much as 2.2%.
reported a 26% increase in net income during the third quarter to $66.7 million, or 91 cents a share. Quarterly sales climbed to $213.4 million this year, vs. $153.4 million last year.
W&T shares were last inching up 2.7% to $35.72.
settled the last remaining lawsuit from victims of the company's Texas City refinery blast Thursday morning days before the trial would have begun. The daughter of two victims sued BP for $1.2 billion in damages after her parents died in the 2005 blast. No financial details were released.
Shares of BP were recently falling 0.6% to $68.35.