World oil prices fell today after rises in US crude inventories helped to offset concern about a spike in heating fuel demand caused by the arrival of freezing weather in the northern hemisphere.
New York's main contract, light sweet crude for delivery in January, fell 64 cents to $58.20 a barrel in pit deals. In London, the price of Brent North Sea crude for January delivery lost 68 cents to $55.73 a barrel in electronic trading.
The falls came after a surge the day before owing to the onset of very cold weather in the US northeast region and western Europe, two of the biggest consumers of energy.
US inventories of crude oil, petrol and distillate products all rose over the past week, the Department of Energy said today. Crude stocks climbed by 400,000 barrels for the week ended November 18 to total 321.8 million, the DoE said. That was in line with analysts' forecasts.
Petrol stocks rose 200,000 barrels to total 200.4 million barrels - much less than expected. Meanwhile, inventories of distillate supplies, which are used to make heating oil and diesel fuel, rose for a second straight week by 1.1 million barrels to 124.5 million, nearly double the amount forecast.
The higher inventory levels suggest that US oil companies have been able to rebuild their stocks thanks to milder weather, after their operations were battered by hurricanes in August and September.
At today's price levels, crude futures had shed almost 18% since striking historic highs of $70.85 in New York on August 30 after Hurricane Katrina tore through US Gulf Coast energy facilities.
Prices have since dropped owing in part to unusually warm weather during October and much of November across the northern hemisphere. Mild weather and rising stockpiles contributed to New York crude futures on Friday closing at $56.14 a barrel, the contract's lowest finish since June 15.
