Crude oil prices climb toward 50 dollars per barrel

Crude oil prices jumped back near $50 Tuesday, hitting their highest level in eight weeks after a fire at a big Louisiana refinery slowed the plant’s fuel production. U.S. light crude for March delivery settled up 83 cents at $49.64 a barrel on the New York Mercantile Exchange. The contract hit a peak of $49.75 in intraday trading, the highest level since November 30. March London Brent gained 95 cents to $46.96 a barrel after hitting $46.99, the highest since November 4. Dealers said the strength tracked a rally in petrol futures after ConocoPhillips confirmed it had been forced to slow production at its Belle Chasse, Louisiana, refinery after a fire on the weekend. “All of this has kept us with a bullish bias,” said Tom Bentz of BNP Paribas. “The cold really helped early in the week, and today there were a few refinery issues.”

Royal Dutch Shell Group said Tuesday it shut 35,000 barrels per day of crude oil production in Nigeria’s southeastern Abia state following community protests. Nigerian oil-worker unions refused to retract a strike threat after talks with the labor ministry, according to a report from the Associated Press Tuesday afternoon. Oil traders are also on alert for any surprises on Jan. 30, when the Organisation of the Petroleum Exporting Countries meets to debate production policy.

Kuwaiti Oil Minister Sheikh Ahmad Fahd al-Sabah said Tuesday that the Organization of Petroleum Exporting Countries should leave its production quota at 27 million barrels per day, according to Agence-France Presse. Al-Sabah cited cold weather in the United States as well as “geopolitical problems, especially in Iraq and the Gulf region,” as reasons for the recent gains in crude. An OPEC basket price — an average of seven types of crude oils — of $35 per barrel is “acceptable for everybody,” the minister also told reporters. “Comments from oil ministers continue to point away form the idea of an immediate production cut and the steady price response to such trial balloon may reinforce a growing consensus to wait on further cuts,” Tim Evans, a senior analyst at IFR Markets said in an afternoon note.

China’s economy remains strong despite government attempts to cool growth. The Asian country’s gross domestic product grew 9.5 percent in the fourth quarter from the same period a year earlier, the government said Tuesday. The failure to date of efforts to slow China’s economic growth “could lead to higher demand for oil,” said Phil Flynn, a senior analyst at Alaron Trading. “China’s thirst for oil will continue to be strong.”