US crude touches 10-month high on supply fears

US crude prices made fresh gains on Tuesday, rallying to a 10-month high as freezing temperatures and wafer-thin fuel stocks in the United States stoked fears of a possible supply crunch.
A huge blast at Algeria's key Skikda refinery added to supply concerns as the nearby port is the country's largest and handles the bulk of its crude, oil product and petrochemical exports.
US light crude futures for February delivery touched peak at $35.54 a barrel, the highest level since March 17 just ahead of the US invasion of Iraq.
The February contract will expire at the end of business on Tuesday. US crude stood at $35.40 per barrel, up 33 cents from Friday's close.
US markets were closed on Monday for a public holiday.
London's Brent crude futures rose 28 cents to $30.85. "Prices have got to be getting towards the top end of the range and we must be getting to the point where some consuming countries will be experiencing some distress," said David Thurtell, commodities strategist at Commonwealth Bank of Australia in Sydney.
Thurtell said a recovery in the value of the US dollar, the currency of international oil trade, would also add to consumers' woes.
The biggest mover has been the dollar/euro rate. The euro, which has risen 13 percent since November and 25 percent since the start of 2003, has fallen four percent in the past week.
Ministers of the Organisation of the Petroleum Exporting Countries, which controls half of world crude exports, have cited a decline in their dollar oil revenues as one reason for sustaining high oil prices.
US crude prices have shot up about $7 a barrel, or 25 percent, since late September when Opec agreed to cut official output limits by 900,000 barrels per day.
Since then, demand has risen with the onset of the Northern Hemisphere winter and US fuel inventories have fallen to the lowest levels since the mid-1970s.
Saudi Arabia is the world's biggers oil exporter and the most influential member of Opec.
Opec is worried that a big overhang of oil will trigger a collapse in prices in the second quarter when demand normally tails off at the end of winter.
It is already pumping about its official limit of 24.5 million bpd, which excludes Iraq output.
The International Energy Agency, the energy watchdog for 26 industrialised nations, last week predicted a huge increase in oil inventories in the second quarter if Opec did not cut supplies from December levels, estimated at 29.95 million bpd including Iraq, which it put at 1.96 million bpd.