Heating oil follows crude up

13/03/2009

Heating oil mimicked an 11 per cent spike witnessed in the price of crude yesterday (March 12th) as it gained nearly ten cents on the gallon.

By the close of trading on the New York Mercantile Exchange, April delivery heating oil contracts had risen to $1.2190 (86.86p) a gallon, up 9.33 cents since the opening of the market.

The gains made on heating oil contracts were responsive to a dramatic spike in the price of crude, which hit $47 a barrel in afternoon trading before falling back to close at $46.96.

A flurry of buying activity followed the announcement from the International Energy Agency (IEA) that the Organisation of the Petroleum Exporting Countries is near triumph in its ambition of rebalancing the iniquity in supply and demand by constricting output.

"Our view is that they don't really need to do very much more in terms of new targets," said David Fyfe, said the head of oil the industry and market division at the IEA, speaking to Reuters.