Oil prices settled above $55 a barrel on Tuesday (Jan. 23) after the federal government announced plans to boost the country’s emergency crude stockpile this spring at a rate of 100,000 barrels per day.
CBS MarketWatch reported that light, sweet crude for March delivery on the New York Mercantile Exchange leaped $2.48, or 4.7%, to settle at $55.04 in New York.
The Department of Energy said Tuesday it plans to increase the capacity of the Strategic Petroleum Reserve to 1.5 billion barrels from 691 million barrels.
U.S. Energy Secretary Samuel Bodman called the move “a wise and prudent policy decision to provide additional layer of protection.”
Oil prices traded higher for most of the trading day, buoyed by falling temperatures in the Northeastern U.S. and rising tensions in Nigeria and Iran.
The Department of Energy’s announcement propelled the market’s rally, however, sending oil prices as high as $55.15 in late day trading.