Oil rises to $80 for first time since November

NEW YORK -- Oil prices on Thursday hit $80 a barrel for the first time in seven weeks as the dollar sank on the final day of the year.

Benchmark crude for February delivery added 61 cents at $79.89 a barrel on the New York Mercantile Exchange. Oil jumped as high as $80 a barrel earlier in the day. It hasn't traded for that much since Nov. 11.

Trading volume has been especially light this week, however, as many investors already closed the books on 2009.

Crude rose as the dollar dropped earlier in the morning. Oil barrels are priced in dollars, and when the dollar drops, oil tends to rise as it becomes easier for investors with foreign currency to buy.

The U.S. government also said Thursday that new claims for unemployment benefits dropped unexpectedly last week -- an encouraging sign that the economy may soon begin creating jobs and put more motorists on the road.

Meanwhile, the Energy Information Administration said that natural gas stockpiles dropped for the fourth straight week. The nation's supply is still well above the five-year average, however, and last week's draw of 124 billion cubic feet was less than what analysts expected.

After the EIA report, the February contract for natural gas gave up 18.2 cents, more than 3 percent, at $5.527 per 1,000 cubic feet.

In other Nymex trading in January contracts, heating oil rose 2.18 cents to $2.1311 a gallon and gasoline advanced 1.59 cents to $2.0565 a gallon.

In London, Brent crude for February delivery rose 41 cents to $78.44 a barrel on the ICE Futures exchange.