01 December 2010 13:23 [Source: ICIS news]
LONDON (ICIS)--Crude oil spot prices have been supported by higher product prices driven up by the colder temperatures across Europe, market participants said on Wednesday.
This rise in buying interest was resulting in an increase in refinery production and a reduction in stocks, the analyst added.
Higher European naphtha prices were also providing support, the analyst said.
European naphtha gained on the back of strong demand from Asia, rising to $810/tonne (€624/tonne) CIF (cost, insurance and freight) NWE (northwest Europe) from $780/tonne a week ago.
Crude oil prices for physical cargoes produced in the North Sea have increased in the past two days.
A number of North Sea crude oil traders said the increase in values on most of the crudes was mainly due to an improvement in margins, as the cold weather was supporting products.
Dated Brent, the benchmark price for many types of crudes in Europe, was at $86.70/bbl, compared with the $84.20/bbl price seen at the beginning of November.
Gasoil spot prices were currently at $787-790/tonne CIF NWE, compared with a range of $714-716/tonne at the start of November.
With LPG, the latest trade on butane was done at $1,018/tonne CIF NWE, up from $940/tonne two weeks ago.
Meanwhile, crude oil futures climbed more than $1/bbl, buoyed by increases in manufacturing output in China and a weaker US dollar.
The January Brent front-month contract was trading at $87.28/bbl, up $1.36/bbl from the previous close, while its WTI counterpart was at $85.37/bbl, up $1.26/bbl.
($1 = €0.77)
Sarah Trinder contributed to this article
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