Oil struck a two-year peak near $99 a barrel in London today, boosted by plunging American crude reserves, and as the key Trans-Alaskan pipeline remained shut following a leak.
The market was also boosted following news of falling crude oil stockpiles in the US - the world's biggest oil consuming nation.
Brent North Sea crude for delivery in February jumped 86 cents to reach $98.47 a barrel, which was the highest level since October 1 2008. New York's main contract, light sweet crude for February, rallied 84 cents to $91.95 a barrel.
Prices pushed higher after the US government's Department of Energy revealed that American crude stockpiles sank by 2.2 million barrels last week. That beat market expectations and suggested stronger-than-expected demand.
Analysts said that as well as the Alaskan pipeline shutdown, forecasts about heavy winter conditions in the US northeast as well as strong equity markets could provide further support to oil prices.
The 800 mile pipeline delivers between 630,000 and 650,000 barrels a day of crude produced in the Arctic region to Valdez port in southern Alaska, from where it is delivered to the US mainland. The link carries about 12% of total US production.
