Jan. 30 (Bloomberg) -- West Texas Intermediate crude rose to the highest level in four weeks after data showed the U.S. economy expanded as Americans’ spending climbed.
Prices advanced as much as 1.3 percent. Gross domestic product of the world’s biggest oil-consuming country grew at a 3.2 percent annualized pace in the fourth quarter, the Commerce Department said. WTI also gained as demand for distillate fuel, which includes heating oil, reached the most in almost six years amid cold weather.
“We are looking at a better economy, and that means higher oil prices,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston. “It’s about the strength of America and better demand. Cold weather is pushing up heating demand, but oil demand could stay even when the weather gets warm.”
WTI for March delivery gained $1.09, or 1.1 percent, to $98.45 a barrel at 9:31 a.m. on the New York Mercantile Exchange after reaching $98.59, the highest intraday level since Jan. 2. The volume of all futures traded was about 15 percent above the 100-day average.
Brent for March settlement increased 21 cents to $108.06 a barrel on the London-based ICE Futures Europe exchange. Futures were 9.8 percent below the 100-day average. The European benchmark crude was at a premium of $9.61 to WTI, compared with $10.49 yesterday.
The GDP gain in the last three months of 2013 matched the median forecast in a Bloomberg survey and followed a 4.1 percent advance the prior three months, Commerce Department data showed.
Growth in the second half of the year was the strongest since the six months ended in March 2012. Consumer spending, which accounts for almost 70 percent of the economy, climbed 3.3 percent.
For all of 2013, the economy expanded 1.9 percent after a 2.8 percent increase in the prior year. The U.S. will use 18.9 million barrels a day of oil this year, according to an estimate from the Energy Information Administration.
Distillate demand surged 20 percent last week to 4.52 million barrels a day, the highest level since February 2008, the EIA, the Energy Department’s statistical arm, said yesterday. It was the third gain in a row. Inventories of distillates dropped for a third consecutive week.
January is on track to be the coldest month of the century in the lower 48 states, according to Commodity Weather Group LLC. About 25 percent of households in the U.S. Northeast use heating oil to warm their houses, according to the EIA.