Crude oil futures Monday were holding on to gains that saw both contracts hit year highs, fueled by continuing U.S. cold weather and uncertainty over the Fed's future plans.
"There is clearly some expectation that the U.S. Federal Reserve could slow the pace of its bond purchase reduction in the wake of the poor U.S. labor market data" that emerged Friday, wrote Commerzbank analysts in a note to clients.
As a result, they wrote, "oil prices made significant gains on Friday and are largely defending them as the new week of trading begins."
On Friday WTI pushed above $100 a barrel in intraday trading for the first time since Dec. 30, before settling at $ 99.88/bbl.
On Monday, March Brent crude on London's ICE Futures exchange was down 5 cents at $109.52 a barrel. On the New York Mercantile Exchange, light, sweet crude futures for delivery in March was down 28 cents at $99.60 a barrel.
David Hufton, of brokerage PVM, said the recent price performance is impressive "for a commodity whose underlying fundamentals look so bearish and when doubts on global growth are so prevalent."
Seeking causes for crude's support, JBC Energy pointed both to elevated winter demand in the U.S., and to "North Sea and Libyan supply worries."
The North Sea's infrastructure is aging, and fields such as the large Buzzard area which supplies Forties crude have been regularly affected by outages.
Libya, meanwhile, has been attempting to get its oil exports flowing freely again, but they continue to be stopped and slowed by internal divisions over who in the North African country should control the commodity, and the revenue it generates.
Recently the ICE's gas oil contract for February delivery was up $7 at $926 a metric ton, while Nymex gasoline for March delivery was down 37 points at $2.7452 a gallon.
