Oil prices head towards US$50 a barrel

25-Jan-05

Northeast USA is experiencing a bad winter - among the five worst in the past century, which has been linked to at least 18 deaths across eight states. The storm which started in the midwest Friday, dumped 30 cms of snow in Detroit, 35 centimeters in New York City, and almost a meter in some parts of the state of Massachusetts. As the date for the OPEC meeting at Vienna approaches and as temperatures in the US drop, oil prices seem well on their way towards US$50 a barrel. This rise has assisted by freezing weather in the US northeast - a major consumer of heating fuel, uncertainty regarding OPEC stand at Vienna and elections in Iraq, expected to trigger violence and lead to more sabotage on oil infrastructure. Supply uncertainties are abound as unions have met in Nigeria, Africa's biggest crude producer, to decide whether to strike. New York's light sweet crude for delivery in March rose to US$49.08 and in London the price of Brent North Sea crude oil for delivery in March rose to US$46.21.