Oil prices firmed on Wednesday after a government report showed a larger-than-expected decline in US heating oil inventories following a stretch of frosty weather in the US Northeast.

US February light crude rose 31 cents to 58.40 dollars a barrel, while London Brent crude rose 41 cents to 56.58 dollars.

The January contract expired on Tuesday, with a closing price of 57.98 dollars per barrel.

The gains came after the US Energy Information Administration said commercial distillate inventories, including heating oil, fell by 2.8 million barrels last week due to a nine percent surge in demand and a slowdown in refinery activity.

The strength was limited, however, as the drop in refining helped boost the nation's crude stockpiles by 1.3 million barrels, leaving inventories more than 12 percent higher than last year.

Refineries may be catching up on maintenance work that they had been unable to carry out earlier as they worked at full tilt to compensate for lost output from hurricane-damaged plants.

Heating oil stocks fell by 1.5 million barrels as US consumers burned more fuel to stave off icy conditions last week. But stocks remained some 5.6 million barrels higher than the same time a year ago.

Forecasts for warmer-than-usual weather for the first quarter of next year have eased worries that heating fuel stocks might be tested this winter and have pressured energy prices lower in recent days.

Prices were also supported by an attack on a pipeline in major oil producer Nigeria that belongs to Anglo-Dutch energy giant Royal Dutch Shell. Nigerian authorities said on Tuesday that unidentified gunmen were suspected of blowing up a major pipeline, cutting output by seven percent from the world's eighth-largest exporter and major supplier to the United States.

Meanwhile, OPEC maintained its production quota at 28.0 million bpd at a meeting in Kuwait on Dec. 12 and decided not to renew its offer for emergency extra output of 2 million bpd.

The cartel will meet again in Vienna on January 31 to assess an expected seasonal drop in demand for energy between April and September, and a possible cut in output is on the cards.

Source: Xinhua