Fading Economic Worries Boosted Oil Prices in 2013

Oil finished the year up 7 percent, with much of the gain coming this month on signs that an improving U.S. economy is leading to greater demand for gasoline and diesel fuel.

Benchmark oil fell 87 cents on Tuesday to close at $98.42 on the New York Mercantile Exchange.

As the year ends, U.S. drivers are paying an average of $3.32 for a gallon of gasoline, about the same as at the end of 2012, when gas was $3.29 per gallon. But gas was less volatile this year, peaking at $3.79 in February, compared with a high of $3.94 in April of last year.

AAA is predicting slightly lower gasoline prices in 2014, because of abundant supplies of North American crude. AAA said that on average, drivers paid $3.49 per gallon this year for gasoline, the lowest price since 2010. The national average has been above $3 for more than three years, AAA said.

Natural gas futures closed at $4.23 per thousand cubic feet, down 4 percent, and ended the year with a gain of 88 cents, or 26 percent. Increased use of natural gas used up some of the big domestic surplus of the fuel from a boom in production. Wintry weather helped boost prices in December.

Brent crude, a benchmark used to price international crudes used by many U.S. refiners, fell 41 cents to $110.80. For the year, Brent fell slightly from its 2012 close of $111.11.

In other energy futures trading Tuesday:

• Wholesale gasoline fell 2 cents to close at $2.79 a gallon.
• Heating oil was unchanged at $3.08 per gallon. Heating oil finished 2012 at $3.05 per gallon.