http://news.yahoo.com/news?tmpl=story&u=/nm/20041007/bs_nm/markets_oil_dc_40 By Tanya Pang SINGAPORE (Reuters) - The price of crude oil broke into new record territory above $52 Thursday on heightened concerns that supplies of heating fuels will prove inadequate during the northern hemisphere winter. U.S. light crude futures set an all-time high at $52.23 a barrel, marking a 60 percent surge in prices since the end of 2003 on the strongest demand growth in a generation and a thinning cushion of spare capacity to cope with supply outages. At 0318 GMT, prices had eased to $52.10, a gain of 8 cents on the day. "We're in uncharted territory. There aren't many reasons to sell and there's lots of reasons to buy oil," said David Thurtell at Commonwealth Bank of Australia in Sydney. A drop in heating oil stocks in the United States helped push U.S. crude to the highest levels in the 21-year history of futures trade on the New York Mercantile Exchange. Government data Wednesday showed heating oil inventories fell 1.2 million barrels to 51.2 million barrels in the week to Oct. 1, leaving commercial tanks 6 percent lower than a year ago. Other major oil consumers also are holding thin heating oil supplies, with world-number-three energy user Japan running a significant deficit against last year. Inventories of heating fuels should normally rise at this time of year ahead of a surge in consumption in winter months. Worries about a thin supply cushion have intensified after mid-September's Hurricane Ivan, which drove U.S. crude production to the lowest level since 1950 and disrupted operations at refineries along the Gulf Coast. About 478,000 barrels per day of crude output in the Gulf of Mexico, 28 percent of total gulf production, remains shut due to storm damage and industry executives estimate it could take 45-90 days to restore supplies from offshore platforms. The hurricane destroyed seven platforms and damaged several mobile rigs, the Energy Information Administration (EIA) said in its winter outlook report. The storm also disrupted operations at Gulf Coast refineries, where plants were still working at only 89 percent of capacity last week, cutting into heating fuel supplies. "Ivan has completely eliminated the cushion of spare distillate stocks in the Atlantic basin," said Yasser Elguindi of Medley Global Advisors in New York. "This is the heart of the problem -- across the globe there is rising oil product demand and little spare refining capacity to meet it." Nigeria also remains a concern. Nigerian oil union NUPENG is threatening to disrupt production Sunday ahead of a general strike Monday, unless the government starts talks on retail fuel prices. Nigeria's oil unions have called strikes four times this year over rising fuel prices in the world's seventh largest exporter. So far none have affected output.
Bush is opening up the strategic petroleum reserve (if he hasn't already). He says it's a response to some of the refineries being shut down by one of the hurricanes. It was last tapped in 2002 due to a hurricane. Gore also tapped it in Sep or Oct. 2000. It's been tapped about 6 times since it was formed in the 70s.
Well, I don't really agree with that policy, though I suppose I will have to abide by it since you're the "moderator". I don't see why we cannot post articles that we find to be of importance. Would you mind explaining your reasoning behind this? Is this coming from Skip or from you? I plan on PM'ing Skip about this to see what he has to say. I cannot see what the problem is with posting articles if they're helping to inform people, especially if people people read and respond to them.
I'm glad i moved out of my gas heated apartment before winter, i hear its going to be expremely expensive, and last winter was bad enough. Great Topic Pressed Rat, keep it up. I find your posts along these lines very informative.
Rat, you can post articles all you want, but at the end or the beginning you have to add a little comment about it, that's all. Peace and Love, Dan
Oil prices can only rise as China, India and Japan consume more (and the hurricaines didn't help either). Open up Alaska and Russia, or let's all start driving hybrids.
RRrrrrright Middle East turmoil and Halliburton couldn't have anything to do with the rising price of oil since Bush took over.
Oh it does, but basic market principles like supply and demand (and the fact that China is beginning to consume a huge amount of oil, and will continue to consume more as time goes on) and political/economuc turmoil in non-Iraqi countries have more to do with the rising cost of oil than Halliburton and Bush.
