Mideast-spurred oil panic highlights U.S. energy shortagegreenspun.com : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread |
Mideast-spurred oil panic highlights U.S. energy shortageSaturday, October 14, 2000 By Richard Valdmanis
The United States was delivered a stark reminder of its fragile energy supplies Thursday after an upsurge in violence in the Middle East sent prices for scarce home heating oil vaulting beyond Gulf War highs. Heating oil jumped to its highest level for nearly 20 years on the benchmark New York Mercantile Exchange more than reversing falls made after the Clinton administration's September release of oil from the Strategic Petroleum Reserve in an effort to mollify markets.
Crude oil futures also hit $37 a barrel, just short of a dollar lower than the post Gulf War highs struck before the SPR release. It ended at $36.06 with hefty gains of $2.81 on Thursday.
While Israel and Palestine produce barely any oil, dealers said they feared the escalating violence in the West Bank and Gaza Strip could raise tensions in surrounding Arab countries and disrupt crude oil supply to the West threatening another blow to an already punch-drunk U.S energy situation.
"What the price action today is telling us is ... if you have any kind of a supply problem (now), there is nothing other than for prices to go up," Adam Sieminski, oil market analyst at Deutsche Bank said.
United States crude oil and refined product prices have become increasingly volatile in the 18 months since producer group OPEC heavily cinched back its exports, bringing national crude inventories close to 24-year lows.
A looming lack of winter heating oil has become the growing concern as rising demand for energy and a dearth of new investment in the domestic U.S. supply system means that refineries and pipelines are having to strain at full capacity just to keep up with everyday needs. http://www.enn.com/news/wire-stories/2000/10/10142000/reu_panic_32513.asp
-- Martin Thompson (mthom1927@aol.com), October 14, 2000
Didn't I see, somewhere, where the National Weather Bureau is forecasting another cold snap or two for the Northern tier of states over the next two weeks? This sure ain't gonna help the heating oil situation.
-- QMan (qman@c-zone.net), October 14, 2000.