Gov't: We Will Head Off Oil Crisis

THE ASSOCIATED PRESS

WASHINGTON

ith oil prices hovering near 10-year highs, the White House said yesterday that it is ready to do what it has to do to deal with the growing crisis  but still declined to tap the nation's Strategic Petroleum Reserve. {BT}"The President will not hesitate to take action to protect the American people," Energy Secretary Bill Richardson said. "And all options to deal with this problem are on the table."

Still, he and the White House declined to say how high oil must climb before the U.S. will dip into its emergency stockpile of more than 571 million barrels.

Richardson met yesterday with more than a dozen Northeast lawmakers worried about heating oil costs and supplies.

"Right now, the squirrels are better prepared for the winter," said Rep. Edward Markey (D-Mass.), one of the lawmakers who met with Richardson.

U.S. crude oil prices briefly soared to $37.15 a barrel at one point Monday. By the end of trading yesterday, it had settled down to $36.51 on the New York Mercantile Exchange.

Heating oil for October delivery fell 2.24 cents, or 2.2%, to $1.0191 a gallon on the exchange.

Sen. Chuck Schumer (D-N.Y.) and other legislators repeatedly have called on President Clinton to tap the emergency stockpile. Schumer has warned that home heating-oil prices will be nearly double last year's $1.31 a gallon for consumers.

Prices have continued an upswing in recent days, in part because of Iraq's threats against Kuwait, which Iraqi President Saddam Hussein said has tapped into his nation's oil supply. A similar allegation led to the 1990-91 Gulf War.

A poster in Venezuela advertises the upcomming OPEC meeting in Caracas. The Persian Gulf area supplies one-third of the world's oil, and nervous traders are worried that Saddam may force a showdown. Oil from the U.S. strategic reserve was last sold during the Gulf War.

OPEC President Ali Rodriguez predicted yesterday that the price of crude oil will not hit $40 a barrel  and that an increase in production next month will ease costs. "Now you will see starting Oct. 1, with these new barrels, the market, the price will begin to drop," Rodriguez said.

The Organization of Petroleum Exporting Countries is boosting output quotas by 800,000 barrels, or 3.2%, to try to bring down prices that have tripled in 18 months.

http://www.nydailynews.com/2000-09-20/News_and_Views/Beyond_the_City/a-80827.asp

-- Martin Thompson (mthom1927@aol.com), September 20, 2000