BUSINESS

Oil rises on US manufacturing, natural gas up 7% for the week on cold weather

03/15/2013 09:16 EDT | Updated 05/15/2013 05:12 EDT
Natural gas and oil ended the week with solid gains, with one boosted by forecasts for colder temperatures and the other by signs that U.S. manufacturing is heating up.

The price of natural gas rose six cents, or 1.6 per cent, to finish at US$3.87 per 1,000 cubic feet on Friday. That boosted its gains to almost seven per cent for the week, mainly as a result of forecasts for cold temperatures in many gas-consuming regions through the end of the month.

Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates, said in a note to clients that he expects natural gas to make "a run at the $4 mark early next week" assuming no change in weather forecasts.

The price benchmark West Texas Intermediate crude rose 42 cents to end at US$93.45 per barrel on the New York Mercantile Exchange.

It was up $1.50, or 1.6 per cent, for the week on signs of improvement in the U.S. job market and manufacturing sector. On Friday the government said a strong increase in auto output boosted U.S. factory production by a seasonally adjusted 0.8 per cent last month.

Brent crude, used to price many kinds of oil imported by U.S. refineries, gained 86 cents to finish at $109.82 a barrel on the ICE Futures exchange in London.

Experts said Brent's rise was due partly to reports of lower oil exports from Iran — which is enduring sanctions from Western powers because of its nuclear program — and expectations about aggravated geopolitical tensions in the Middle East related to the upcoming visit to Israel by President Barack Obama.

A weaker dollar was also supporting oil prices, making crude cheaper for traders using other currencies.

In other energy futures trading on the Nymex, wholesale gasoline added two cents to end at US$3.16 a U.S. gallon (3.79 litres) while heating oil rose one cent to finish at US$2.94 a gallon.

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