Oil hits 4-month high on US economic data, Algeria

January 17, 2013 - 5:32 PM

NEW YORK (AP) — The price of oil rose to a four-month high Thursday on positive reports about the U.S. economy.

Benchmark oil gained $1.25 to finish at $95.49 a barrel, the highest close for crude on the New York Mercantile Exchange since Sept. 17. Oil has now gained 4 percent this year.

Strong reports on housing starts and fewer unemployment claims made traders more optimistic about the U.S. economy. Builders started work on homes in December at the fastest pace since the summer of 2008, and the number of Americans seeking unemployment benefits fell to a five-year low last week. Both reports could signal greater demand for fuel.

The situation in Algeria also gave a boost to oil. Algerian forces launched a raid to free hostages being held by militants at a remote natural gas facility. Some casualties were reported.

Traders are waiting for China's growth data Friday to better assess the strength of the global economy. China will release fourth-quarter growth data for 2012 as well as overall GDP figures for the year.

In the U.S., pump prices held steady around an average $3.29 a gallon — right where they began the year.

Meanwhile Brent crude, used to price international varieties of oil, rose $1.42 to end at $110.10 per barrel on the ICE Futures exchange in London.

In other energy futures trading on Nymex:

— Wholesale gasoline rose 5 cents to finish at $2.77 a gallon.

— Natural gas rose 6 cents to end at $3.49 per 1,000 cubic feet.

— Heating oil added 2 cents to finish at $3.02 a gallon.

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Pamela Sampson in Bangkok and Pablo Gorondi in Budapest contributed to this report.