Oil climbs as cold blanket covers Europe, US Northeast

World oil prices advanced further in Asian trade Monday as fuel demand, especially heating fuel, climbed as most parts of Europe and US Northeast fell under the cold blanket.

Light sweet crude for January delivery was seen trading at $88.24 a barrel at 12.00 noon Singapore time while The more actively traded February contract declined 18 cents to $88.42. US January contract will expire at the end of trading on Monday.

Brent crude for January was at $91.86 a barrel in London.

Analysts also attributed oil’s climb on speculation the U.S. economic recovery will strengthen next year and boost fuel demand and renewed tensions in the Korean Peninsula.

The U.S. Northeast, the world's top heating oil market, was expected to be colder than usual from December 24 to 28, according to weather data released on Friday.

In Europe, Arctic conditions were expected to continue in the north this week, potentially prolonging traveling disruptions during one of the busiest times of the year.

U.S. heating oil futures nudged up 0.68 cents to $2.4805 a gallon, while gasoline rose 1.37 cents to $2.3315 a gallon. Oil prices also found support from and positive U.S. economic data.

On Friday, January delivery rose 34 cents to settle at $88.02 a barrel on the New York Mercantile Exchange while Brent crude rose 7 cents to settle at $91.67 a barrel on the ICE Futures exchange.

In other Nymex trading in January contracts, heating oil fell 0.26 cent to settle at $2.4737 a gallon, gasoline futures added 1.35 cents to settle at $2.3178 a gallon and natural gas gained 1.8 cents to settle at $4.066 per 1,000 cubic feet.