BUSINESS

Oil passes $97 on stock gains, economy; natural gas falls back, still above $4

03/28/2013 10:37 EDT | Updated 05/28/2013 05:12 EDT
NEW YORK, N.Y. - The price of oil rose above US$97 a barrel Thursday for the first time in five weeks, boosted by gains in U.S. stock markets and more signs of a strengthening economy.

Benchmark oil for May delivery gained 65 cents to close at $97.23 a barrel in New York. Oil has gained nearly $5 per barrel in the past week, driven by encouraging economic indicators.

The government said the U.S. economy grew at 0.4 per cent in the fourth quarter, up from a previous estimate of 0.1 per cent growth. And analysts think the economy is growing at a rate of around 2.5 per cent in the current January-March quarter, which ends this week.

Oil's gains haven't yet factored into pump prices. The average price for a gallon of gas in the U.S. was $3.645, down from $3.65 a day earlier. Gas is now on average about 27 cents cheaper than a year ago.

In Canada, the price at the pump averaged C$1.284 per litre, according to price-watching website GasBuddy.com.

Meanwhile the price of natural gas retreated, a day after it closed above US$4 for the first time since Sept. 14, 2011. Natural gas futures fell four cents to end at $4.02 per 1,000 cubic feet. Natural gas has risen 67 cents, or 20 per cent, this year as colder weather and greater use of natural gas for power generation have helped whittle away at a large surplus of the fuel in the U.S.

Brent crude, used to price many kinds of oil imported by U.S. refineries, was down 33 cents to finish at $109.38 a barrel on the ICE Futures exchange in London.

In other energy futures trading on the Nymex:

— Wholesale gasoline fell one cent to end at $3.11 a gallon.

— Heating oil was flat at $2.92 a gallon.

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Pamela Sampson in Bangkok and Pablo Gorondi in Budapest contributed to this report.

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