US will have problems selling SPR oil--OPEC president Reuters Company News - October 04, 2000 12:50

Copyright 2000 Reuters Limited.

The White House announced plans to release oil from its huge Strategic Petroleum Reserve last month as the country faces the threat of heating oil shortages just as its citizens elect a new president in November.

"They will have some problems placing the strategic reserves because several companies invited to bid for them are not participating in the auction," Rodriguez, who is also Venezuelan Energy and Mines Minister, told a radio interview.

Some big companies such as Royal Dutch/Shell , Texaco Inc. , BP Amoco Plc and Conoco Inc. have submitted bids for the 30 million barrel offer in November, but No.1 oil company Exxon Mobil Corp. , Phillips Petroleum Co. and Coastal Corp. all declined.

"I insist the problem is not crude oil availability, but refining capacity, refinery utilization," Rodriguez added.

Oil companies have failed to use their refineries fully this year because of low profitability and tough environmental rules that restrict the amount of products they can make.

The oil transport infrastructure in the United States is also operating near capacity.

Despite crude oil supply well above demand for most of this year, U.S. crude oil futures have been forced up by localised shortages of gasoline and heating oil.

http://www.hoovershbn.hoovers.com/bin/story?StoryId=CoDQRqb9DtJa0nJG1odq1

-- Martin Thompson (mthom1927@aol.com), October 04, 2000

Answers

Eleven companies win oil from US stockpile - DOE Oct 04, 2000 04:03 PM ET

Reuters

WASHINGTON, Oct 4 (Reuters) - The U.S. Energy Department announced Wednesday that 11 companies submitted winning bids to borrow 30 million barrels of crude oil from the nation's emergency oil stockpile to help ease prices and supplies ahead of the winter heating season.

The winning bidders must restock the Strategic Petroleum Reserve next year with the same amount of oil as borrowed, plus an additional 1.56 million barrels, an Energy Department spokesman said.

Companies to receive the oil include BP Amoco Plc , Amerada Hess Corp , Morgan Stanley, Valero Energy Corp .

Last month, the White House ordered the loan of 30 million barrels of oil from the nation's emergency reserve to boost supplies of heating oil and ease prices ahead of the winter heating season.

The winning bidders will take 24.05 million barrels of sweet crude oil, and 5.95 million barrels of sour crude.

http://www.localbusiness.com/Story/0,1118,NOCITY_428094,00.html

-- Martin Thompson (mthom1927@aol.com), October 04, 2000.

There's a startler. I didn't even know the Petroleum Reserve had any sweet crude in it.

-- Uncle Fred (dogboy45@bigfoot.com), October 04, 2000.

Oil companies have failed to use their
refineries fully this year because of low
profitability and tough environmental rules
that restrict the amount of products they
can make.

This is like saying, "I failed to make it to
work ontime because of all of the speed limit
laws and the police that retrict how fast I
can drive."

-- spider` (spider0@usa.net), October 04, 2000.

Isn't that something like saying puke, but don't vomit?

-- Qman (qman@c-zone.net), October 04, 2000.

I was surprised, too, that the Feds got rid of the whole 30 million barrels. Also, that they even had light sweet crude in the inventory. This must represent a few barrels of the good stuff at the top of their inventory, because I'm sure the bulk of that 570-million barrel stock is the sticky, gooey thick stuff that the refineries hate to mess with.

-- Billiver (billiver@aol.com), October 04, 2000.