Gas, oil prices rise on LI over Mideast fears
Gasoline and heating oil prices crept up again on Long Island in the past week as fears of further unrest in the Middle East and surging crude oil futures abroad overcame ample supplies of refined products in this country.
Regular gasoline averaged $3.423 a gallon Wednesday on Long Island, the AAA said, up 1.3 cents from a week earlier and 55.9 cents higher than a year earlier.
At that price, a person driving the national average of 269 miles a week in a vehicle that gets 20 miles to the gallon is paying an extra $7.52 a week for fuel this year over last.
Heating oil averaged $3.754 a gallon, according to the state Energy Research and Development Authority, up 1.8 cents from a week earlier and almost 74 cents a gallon higher than a year earlier. That means it costs $203 more this year than last to fill a typical 275-gallon homeowner's tank.
James Ritterbusch, president of Ritterbusch & Associates, an oil trading advisory firm in Galena, Ill., blames the prices on continued investor interest in commodities like oil, fears about further Middle East unrest, and growing demand from emerging economies such as China's, especially for diesel fuel.
The last two are reflected especially, he said, in the $100-plus price per barrel in London of benchmark Brent North Sea oil, which is about $15 more than more ample U.S. oil traded on the New York Mercantile Exchange.
"We don't have a big supply surplus overseas and the Brent market is reflecting that," he said. That is driving up market prices even of fuels made from cheaper U.S. oil, he said. Further, some experts said supply bottlenecks are keeping some U.S. oil from reaching U.S. Gulf Coast refineries.
Unrest appears to be spreading from Egypt to other nations in the Middle East. There have been demonstrations in recent days in Iran, Libya, Bahrain and Yemen, and there was a report Wednesday that two Iranian warships planned to sail through the Suez Canal en route to Syria.
John Kilduff, a partner at Again Capital Llc, a hedge fund based in New York and specializing in energy, said consumers might see some relief if that activity abates. "If the Middle East would calm down, these prices should go lower in the next couple of weeks," he said.
Heating oil on Long Island ranged during the last heating season from an average of $2.698 in the state survey in September of 2009 to $3.158 in January 2010 from full service dealers. Cash on delivery prices usually were lower.