OIL prices rose yesterday but base metals were mixed as sentiment towards commodities remained cautious in spite of a positive reaction from global stock markets to President Barack Obama's inaugural State of the Union address on Wednesday night. United States (U.S.) weekly inventories data, released on Wednesday, showed crude stocks down 3.9 million barrels last week, compared with the consensus forecast for a rise of 1.4 million barrels. In energy markets, crude oil prices rose with Nymex March West Texas Intermediate up 47 cents at $74.14 after dropping by more than $1 on Wednesday following the latest U.S. weekly inventories data. ICE March Brent gained 56 cents at $72.80 a barrel. Much of the drop was explained by weak imports, however, down 673,000 barrels a day (b/d) to 7.87 million b/d last week as fog affected shipments in the Houston ship channel. Demand from U.S. refineries remained weak with refinery utilisation up 0.1 percentage points to 78.5 per cent. Refinery activity sank to the lowest rate in 20 years - excluding shutdowns caused by hurricanes - in the previous week. U.S. refineries are due to start seasonal maintenance programmes, which is likely to act as a further drag on their demand for crude oil. The impact of the fall in crude inventories was largely offset by evidence of disappointing weakness in demand for petrol and heating oil. Distillate stocks (including heating oil) rose 400,000 barrels, confounding the consensus forecast for a drop of 1.7 million barrels. Demand for heating oil weakened as milder temperatures returned to the U.S. north-east but more colder weather has been forecast. Yesterday, Nymex February heating oil added 1.4 cents, or 0.7 per cent, at $1.9307 a gallon. Petrol stocks increased two million barrels, above the consensus forecast for a rise of 1.1 million barrels. Nymex February RBOB unleaded gasoline also added 1.4 cents, or 0.7 per cent, at $1.9524 a gallon. Gold traded below the $1,100 mark at $1,087 a troy ounce mark after ending Wednesday's session in New York at $1,088.35, continuing to take a lead from any modest dollar fluctuations. The dollar's trade weighted index has reached a five month high, raising downside pressures on bullion. The Federal Reserve kept U.S. interest rates unchanged, as widely expected at its meeting on Wednesday, and delivered an upbeat assessment for the U.S. economy's outlook. "The Fed's statement offered no surprises with the key phrase maintaining interest rates at 'exceptionally low levels ... for an extended period' surviving yet another meeting," said Sue Trinh, a senior currency strategist at the Royal Bank of Canada. RBC said attention would now shift to Ben Bernanke who was on Thursday awaiting confirmation for a second four-year term as chairman of the U.S. Federal Reserve by the Senate. Base metals were mixed with copper down 0.5 per cent to $7,155 a tonne, sliding lower after a positive start. Aluminium was fractionally lower at $2,145 a tonne while zinc eased two per cent to $2,160 a tonne and lead lost 1.4 per cent at $2,065 a tonne. Nickel managed to hang on to its early gains, rising 0.8 per cent to $17,950 a tonne. White sugar prices remained near their recent all-time high in spite of news on Wednesday that the European Commission had proposed an increase of 500,000 tonnes in European exports in response to the "exceptional" supply situation in the global market. ICE March raw sugar added 1.1 per cent at 28.76 cents a pound while Liffe March white sugar added 0.6 per cent to $727.20 a tonne after reaching a record $767 last week on concerns about low global stocks.

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