Oil edged up towards $82 a barrel today, heading for its ninth straight session of gains as a cold snap in the key consuming regions of the United States and Europe boosted demand for heating fuel.
A slew of US data - November factory orders later in the day, besides jobless claims and employment numbers later in the week - will offer clues on the health of the economy and demand outlook from the world's top oil consumer.
Markets are also keeping an eye on an oil pricing dispute between Russia and Belarus that briefly cut off supplies to the Eastern European nation. Russia yesterday said it had resumed supplies to refineries in Belarus, but tension still simmers.
Weekly US oil inventory data from the American Petroleum Institute (API) due later today and the Energy Information Administration (EIA) due on Wednesday are also expected to be mildly price supportive.
US crude for February delivery rose 20 cents to $81.71 a barrel by 0550 GMT, off a morning high of $81.89 and after settling up $2.15 at $81.51 on Monday, its highest close since October 9th, 2008.
London Brent crude climbed 25 cents to $80.37.
"Oil is very well supported due to colder weather in the northern hemisphere markets, and it looks like the bullish bias is here to stay for now," said Tony Nunan, a risk manager with Tokyo-based Mitsubishi Corp.
"We're also seeing new money coming in on the long side, taking fresh positions for the new year."
Frigid temperatures were expected to boost US heating demand to 21 per cent above normal, with consumption in the US northeast - the largest heating oil market - seen 11 per cent above average levels.
Unusually cold weather in Britain is expected to continue into the second half of January after the coldest December since 1995, while colder temperatures in Europe were seen gradually spreading from the northeast to the southwest during the next few days.
Heavy snows and biting cold also hit parts of Asia today, with unusually harsh winter weather snarling transport across north China, South Korea and India.
Oil also got a boost from a weak dollar. The greenback steadied today, keeping broad losses made the previous day, as growing hopes for a global economic recovery spurred investors to shift funds to riskier assets from the greenback.
US economic data due this week will likely show that a patchy recovery is already underway in the world's largest economy. At 1500 GMT, the Commerce Department will release November factory orders, which are expected to rise 0.5 per cent compared with a 0.6 per cent gain in the prior month.
At 2130 GMT, API data is forecast to show a 1.9 million barrel drawdown last week in distillate stocks, which include heating oil and diesel fuel, while crude stocks were seen unchanged and gasoline supplies higher.