Oil prices surged above $55 a barrel on Friday on rising fears of a winter fuel supply crunch and robust economic growth in China, the world's number two user.
Crude for December delivery ended 70 cents a barrel higher at $55.17 on the New York Mercantile Exchange (search), where heating oil futures climbed 1.49 cent to an unprecedented $1.5944 per gallon.
Crude prices have hit a succession of record highs over $50 for the past three weeks. Brent crude oil rose 70 cents to $51.42 a barrel.
The rally in heating oil has also spilled over into natural gas futures, which soared 50.3 cents Friday to $8.20 per 1,000 cubic feet. Natural gas futures are now about 67 percent higher than a year ago, even though analysts agree that supplies of this mostly-domestic fuel are ample.
"The primary concern now is the heating oil inventory level in the U.S," said Victor Shum, an analyst at Texas-based energy consultants Purvin & Gertz.
On Wednesday, the Energy Department (search) reported that U.S. inventories of distillate fuel, which include heating oil and diesel, shrank for the fifth consecutive week, leaving supplies nearly 10 percent below year ago levels.
U.S. supplies of heating oil fell last week to stand 12 percent below this time in 2003, a gap that traders fear refiners will not be able to close if the heavy consuming Northeast is hit with an early or severe winter.
Federal weather forecasters said on Thursday they were still unable to predict whether the U.S. Northeast or Midwest would have a cold, warm or normal winter, with equal chances of each.
The normal autumn stockbuild has been hampered by the damage that last month's Hurricane Ivan (search) caused in the oil-producing Gulf of Mexico, where more than 400,000 barrels per day (bpd) of U.S. production remains shut in.
China, the engine behind this year's surge in oil demand, has moved to rein in blazing economic growth to avert a potential meltdown.
Annual economic growth has slowed three quarters in a row, but at 9.1 percent the pace of expansion remains strong, official data for July-September showed on Friday.
Earlier this week, data showed crude oil imports rising by a slower pace in September, but oil company officials say they are on track to expand by 10 percent next year.
A weaker dollar has helped support oil's run-up by cushioning the impact of higher prices for consumers using other currencies, particularly in Europe and Asia.
U.S. Federal Reserve Board (search) Governor Ben Bernanke said on Thursday higher energy costs had constituted a "significant shock to the economic system" and were likely to cut U.S. economic growth by a half to three-quarters of a percentage point this year.
And American consumers show no signs of curbing their purchases of gas-guzzling sport utility vehicles, despite high prices, DaimlerChrysler's chief of marketing and sales said.
Reuters and the Associated Press contributed to this report.