U.S. crude oil prices surge more than $1 on gasoline worriesgreenspun.com : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread
U.S. crude oil prices surge more than $1 on gasoline worries Updated 1:41 PM ET April 10, 2001 By Richard Valdmanis NEW YORK (Reuters) - U.S. crude oil prices surged more than four percent Tuesday led by refined products, as fears mounted that paper-thin gasoline supplies would not recover before driving season.
Front month crude oil futures on the New York Mercantile Exchange (NYMEX) jumped $1.12 to $28.40 a barrel, while gasoline soared 3.78 cents to $1.029 a gallon and heating oil gained 5.42 cents to 79.00 cents a gallon.
The gains came amid continued refinery snags in the U.S. only weeks away from the traditional start of peak motorist demand, which led oil dealers to forecast continued tight gasoline supply levels into late-spring.
A number of U.S. refineries in the Gulf Coast and Northeast were having trouble restarting from routine spring maintenance or were beginning repair work, and a key distillate refinery in the Caribbean was shut by a fire on Monday.
"These refinery problems are particularly sensitive now, since inventories are already alarmingly low," said one New York-based refined products trader.
As of the end of March, U.S. gasoline supplies were roughly five percent below year-ago levels, highlighting concerns of a repeat of last year's record price spikes which pushed pump prices as high as $2.75 a gallon in hard-hit cities like Chicago.
Oil dealers said they were anticipating a seventh straight week of declines in gasoline inventories when the American
e of business Tuesday.
Adding to the strength was technical buying by investment funds which had been short on oil futures and were now buying buying back contracts, dealers said.
The latest data from the Commodity Futures Trading Commission, released last Friday, showed speculators with their largest NYMEX crude net short positions since January 1998 - a bet that prices would fall.
"U.S. gasoline is getting incredibly tight and the funds are short. They could easily push the market higher again," said a London futures dealer.
The previous jump into net short positions was tied to expectations that an economic downturn would cut into petroleum demand, and a report that OPEC would likely bust its production quota by nearly a million
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