Prices rise above $95 as December futures expire

London: Oil rose above $95 on Friday as traders consolidated their positions ahead of the expiry of the December contract. US crude for December, which expired at the close of trading yesterday, briefly surged by more than $2. By 1446 GMT, the contract traded up $1.84 at $95.27 a barrel.

London Brent crude for January rose $1.35 at $91.58.

"The jump in prices is linked to expiry. The remaining open interest in December futures is above normal," said Olivier Jakob of Petromatrix.

Oil stands about four per cent below the record high of $98.62 a barrel achieved on November 7. Prices clawed back their losses from Thursday as traders scrutinised the details of the unexpected 2.8 million-barrel increase in US crude inventories. Analysts had predicted a decline of 800,000 barrels.

"A rebound in US crude stocks, due in part to a one-off backlog of imports, was... less bearish than it appeared," said Fimat energy analyst Antoine Halff.

Analysts said the prospect for tightening winter fuel conditions would keep prices supported. "Losses will be limited unless there is extra Opec supply," said Gerard Rigby of Fuel First Consulting in Sydney.

Opec will not discuss output levels at a heads of state meeting on November 17-18, but officials said it will be on the agenda at the next policy meeting on December 5 in Abu Dhabi.

Oil prices have surged nearly 40 per cent since mid-August, as worries about winter supplies, the weakening dollar and geopolitical tensions drew speculative investment.