Oil price extends gains amid cold US weather

LONDON - The price of oil rose yesterday on prospects US demand will hold up amid cold weather, offsetting worries about a slowdown in emerging economies.

By late afternoon in Europe, the benchmark US crude contract for March delivery was up 42 cents to $97.78 a barrel in electronic trading on the New York Mercantile Exchange. It gained 76 cents to close at $97.19 on Monday in New York.

Brent crude, a benchmark for international oil used by many US refineries, was up 20 cents at $104.93 on the ICE exchange in London.

Northeastern US is bracing for a second storm of the week, forcing classes to be canceled and government and business offices to close. Anywhere from a few inches to a foot or more of snow is expected to fall on East Coast states, and some places are expected to get freezing rain and sleet.

The cold is expected to increase demand for heating fuels, driving up the cost of crude oil as well.

Expectations for higher demand offset lingering concerns about an economic slowdown in China and some emerging markets that have caused turmoil in stock markets.

Also helping were US economic indicators released yesterday that were mostly upbeat. A private payrolls firm, ADP, said hiring continued at a steady pace in January, while a survey of the services sector showed continued growth.

In other energy futures trading on Nymex:

— Wholesale gasoline inched up 1.1 cents to $2.614 a gallon.

— Heating oil added 2.7 cents to $3.01 a gallon.