Low Supply of Heating Fuel Lifts Crude Oil Prices 4.3% By BLOOMBERG NEWS

Crude oil prices rose more than 4 percent yesterday on expectations that heating oil supplies at United States refineries, now down more than one-third from levels a year ago, will still be low when cold weather spurs demand in the weeks ahead.

Supplies are low partly because refiners concentrated on making gasoline during the peak summer driving season.

Extra oil from the Organization of Petroleum Exporting Countries was set to start flowing yesterday, and the United States is releasing 30 million barrels of its emergency reserves, but it will take time for those supplies to reach refineries for processing, analysts said.

"Until heating oil and gasoline supplies are seen rising, prices will be high," said Michael Fitzpatrick, a trader at Fimat USA Inc. in New York. "We need to see them in storage tanks. That is tops on everyone's radar screen right now."

Crude oil for November delivery rose $1.34, or 4.3 percent, to $32.18 a barrel on the New York Mercantile Exchange, the biggest gain since Sept. 15.

Prices are still down 15 percent from a 10-year high of $37.80 on Sept. 20, two days before President Clinton announced the release of oil from national reserves.

In London, Brent crude oil for November settlement rose $1.24, or 4.2 percent, to $31.08 a barrel on the International Petroleum Exchange.

Bill Richardson, the United States energy secretary, met yesterday with oil refiners, petroleum marketers and transportation experts to discuss ways to get more refined products to consumers.

"We're getting positive information about heating oil stocks," he said in Washington.

Many refiners take advantage of periods of slow demand in the spring and the fall to retool and to perform routine maintenance work. Officials at the Energy Department have said that if refiners increase production this month, as they did in 1996, they could make more heating oil than usual before the weather becomes cold.

Heating oil for November delivery rose 3.49 cents, or 3.8 percent, to 96.05 cents a gallon on the New York Mercantile Exchange. Gasoline for November delivery rose 3.66 cents, or 4.3 percent, to 88.31 cents a gallon.

http://www.nytimes.com/2000/10/03/business/03OIL.html

-- Martin Thompson (mthom1927@aol.com), October 03, 2000