Crude oil traded at $79 a barrel on 31 December, an increase of more than $30 from a year before after a volatile year when the market was largely defined by uncertainty over the future of the global economy.

The US’ benchmark February West Texas Intermediate contract was trading at $79.30 on 31 December, up $2 a barrel from $77.15 a week before, and marking the highest price seen since 18 November. The contract traded at $44.60 a barrel on 31 December 2008, some 44 per cent lower.

In the intervening year, prices hit a low of $33 a barrel in January and February and a high of $82 a barrel on 21 October. The average price for WTI in 2009 was $62 a barrel, down from the $99 a barrel average seen in 2008, when prices hit an all-time record high of more than $147 a barrel in July.

The global financial crisis which started in 2008 and the subsequent fall into recession in a number of major economies saw demand for oil fall in 2009, to 84.6 million barrels a day from 86.1 million barrels a day a year before. Prices crumbled to sub-$40 a barrel levels on the back of fears that economic growth, and hence demand, would not recover for some years.

At the end of the year, values for crude oil contracts have increased the most since 1999-2000, largely on the back of renewed confidence over growth in major economies and the robust growth seen in China.

Analysts at Barclays Capital, the investment arm of the UK bank, predict an average $85 a barrel price for crude oil in 2010 as credit markets ease and growth continues, albeit slowly. The analysts warn, however, that it will be another volatile year for the market as 2009’s focus on economic growth moves to future supply dynamics and geopolitical concerns.