Supply fears push oil prices upwards

Oil prices hit $56 per barrel on Monday before dropping back again slightly. Brent rose 32 cents to $55.29, but at one point it had risen to $55.70. Nymex WTI rose 23 cents to $55.62 a barrel for June deliveries by midmorning in London.

Nymex has risen for five days in a row. It has gained over $4 per barrel in that time. This weeks rise was its largest weekly gain in four months, nearing its all-time high of $58.28 per barrel, which it reached three weeks ago.

Recent refinery problems in Kansas and Texas have caused concern, and helped spur the rise in crude oil prices. Refineries are already operating at near-capacity in an effort to meet current demand.

The concern is that with refineries already near capacity, higher demand during the summer months might go unmet. This worry was only increased by the news that a Louisiana refinery owned by Conoco-Phillips would be closed for another week after it failed to start up as scheduled after being closed for maintenance.

Gasoline stockpiles fell last week but are still 5 percent higher than a year ago.