Saudi production cut announcement drives oil prices higher

Crude oil prices gained ground on Tuesday after Saudi Arabia told its customers that it will cut another 158,000 barrels per day from its crude oil production schedule beginning February 1. The cuts were in line with production decreases already announced by the Organization of Petroleum Exporting Countries.

Prices, especially for heating oil and natural gas, were also sent higher by weather forecasts that predicted more cold weather for parts of the United States. Nymex heating oil for February delivery added almost 6 cents to $1.6068 per gallon, while Nymex March Henry Hub natural gas added a bit more than 66 cents to $7.600 per million British thermal units.

March contracts for Brent crude added $1.67 to $55.35 per barrel in London, while West Texas Intermediate crude for March delivery was up $2.10 to $56.12 per barrel on the New York Mercantile Exchange.