TODAY'S PAPER
59° Good Morning
59° Good Morning
Business

Crude oil tops $100 as U.S. supplies dip

U.S. crude oil topped $100 for the first time in two months in futures trading Friday as gasoline and heating oil prices continued inching up on Long Island.

Benchmark West Texas Intermediate crude settled at $100.32 a barrel on the New York Mercantile Exchange, up 77 cents from Thursday's close after the federal government reported U.S. crude supplies fell to the lowest level since September.

Regular gasoline averaged $3.681 a gallon in Nassau and Suffolk Friday, the AAA said, up 1.6 cents from a week earlier and 4.5 cents from a month earlier.

Analysts have blamed higher crude oil prices and a temporary hike in the cost of ethanol, which comprises 10 percent of fuel at the pumps. The new average is 8.5 cents lower than a year earlier. Analysts say higher crude oil prices largely reflect economic growth worldwide.

Heating oil, meanwhile, averaged $4.148 a gallon on Long Island on Tuesday from full-service dealers, according to the New York State Energy Research and Development Authority. That's up 5 cents from a week earlier and almost 15 cents a gallon from its recent low on Nov. 11. But it also is 8.5 cents lower than a year earlier.

The Energy Department has forecast a 5 percent drop in heating oil prices this winter from last, but a 3 percent increase in consumption because weather forecasters expect a colder winter in the Northeast.

A Bloomberg News survey Friday of 11 energy analysts found eight forecasting a decline in crude prices next week as gasoline inventories increase amid increasing refinery production.

Long Island drivers had been getting a break at the pumps in the fall as regular fell to a recent low of $3.507 a gallon, on Nov. 11, according to the AAA.

Despite increased demand from holiday-related driving, gasoline supplies are ample. The U.S. Department of Energy reported that stockpiles climbed to a four-month high in the week ended Dec. 13 and fell only slightly last week.

Demand for gasoline nationally rose by 1.7 percent last week from the week before, to 9.17 million barrels per day, the department said.

"Fundamentally, we are awash in energy as we approach the end of the year," Gordy Elliott, a risk-management specialist at Intl FC Stone LLC in St. Louis Park, Minn., told Bloomberg. "The key is, we have very little shortage of products."

Benchmark U.S. crude oil has risen from a recent low of $92.30 Nov. 27.

The AAA gasoline survey is based on the lowest price available at stations that charge less for cash than credit card purchases.

The record high Long Island average in the AAA survey was $4.34 a gallon, set in July 2008.With Bloomberg News

More news