Crude oil futures rose by more than US$2 a barrel on Friday after three days of declines, as petroleum products soared and traders established bullish bets ahead of the long weekend in the US.
The August crude contract on the New York Mercantile Exchange surged US$2.25 to settle at US$58.75 a barrel.
Brent crude jumped US$1.96 to settle at US$57.54 a barrel on London's International Petroleum Exchange.
Meanwhile, the front-month August heating-oil contract on the New York Mercantile Exchange climbed US$0.0990 to an intraday high of US$1.7350 a gallon (3.79 liters), the highest level for a front-month contract recorded since heating oil futures began trading on the Nymex in 1979.
The contract gave up some of its gains to close at US$1.7111 a gallon, up US$0.0750 a gallon. The previous record of US$1.6950 a gallon had been reached in early April amid a rally in energy futures.
The August gasoline futures contract jumped US$0.0827 to US$1.6495 a gallon, while August crude oil climbed US$2.25 to US$58.75 a barrel. The contract hit a record high of US$60.95 on Monday.
On the year, heating oil and crude oil futures have climbed more than 40 percent on the Nymex, while gasoline futures have advanced more than 52 percent higher, a rally that has been fed by fears that demand will outpace supply during the second half of the year when demand for petroleum products peaks.
The heating oil rally came as part of a broad-based rally in energy futures ahead of the long Fourth of July holiday weekend. Glitches in refinery operations as well as the possibility of a hurricane forming in the Gulf of Mexico next week prompted traders to cover recently established short positions and to establish new bullish bets.
Oil prices dropped 7 percent between Monday and Thursday, leaving the market primed for a bounce. With the market tightly balanced market and vulnerable to supply snags, traders are playing it safe, analysts said.
Among refineries experiencing snags, Shell Deer Park Refining said its second restart of a key gasoline-producing unit failed on Wednesday and the plant was to restart it again yesterday.
Shell now expects the 67,000-barrels-a-day catalytic cracker to return to normal production rates by the end of next week, spokesman David McKinney said in a brief e-mailed statement, according to Dow Jones Newswires. Initial production is expected by Tuesday.
Friday's rise in oil prices comes as OPEC suspends talks on a possible increase of its official production ceiling.