LONDON, Nov 7: World oil prices fell strongly on Monday, as mild weather in the US northeast eased concerns about possible shortages of heating fuel during the region’s looming winter, analysts said.

Prices were weighed down also by a marked recovery to US energy production after recent hurricanes.

“Should the recent acceleration in the rate of recovery of crude oil output in US Gulf of Mexico continue, then crude oil prices look likely to remain subdued early this week,” Barclays Capital analyst Kevin Norrish said.

On Monday, New York’s main contract, light sweet crude for delivery in December, shed 98 cents to $59.60 per barrel in pit deals.

In London, the price of Brent North Sea crude for December delivery sank $1.05 to $58.20 per barrel in electronic trading.

Prices fell “as the weather remained mild in the US northeast, dampening the demand for heating oil”, Sucden analyst Sam Tilley said.

Temperatures in the region, which is the world’s largest heating oil market, were expected to remain well above normal until at least Tuesday of next week, according to private forecaster Meteorlogix.

Prices are “trading downwards because in the short-term the market looks a little bearish with mild northern hemisphere weather”, said Victor Shum, an analyst with energy consultancy Purvin and Gertz in Singapore.

At the same time, there appeared to be strong support around $60, he said.

Oil futures on both sides of the Atlantic had vaulted above $60 per barrel last Thursday on heightened concern about a potential cold snap in the northern hemisphere, and also on technical trading.

However prices at current levels have fallen nearly 16 per cent since they hit a historic high of $70.85 on August 30 in New York, after Hurricane Katrina struck the southern United States and severely damaged the country’s major oil installations.

Tilley noted that prices have suffered also owing to “a much further improved recovery rate for the US oil production in the Gulf of Mexico”.

Production was running at the highest level since late August, before Katrina struck, he added.

Traders were keenly awaiting the latest US inventory data due on Wednesday.

The US Department of Energy last week said that distillates stockpiles, which include heating fuel, fell by 200,000 barrels in the week to October 28.—AFP