$62.31 a barrel....Crude oil prices settled at a new high above $62 a barrel on Friday, rallying late in the day on concerns about refinery snags and following the release of a positive U.S. jobs report.
Analysts said gasoline prices — now averaging $2.29 a gallon nationwide — are likely to head higher.
Light, sweet crude for September delivery rose 93 cents to close at $62.31 a barrel, a nominal record for crude since trading began on the New York Mercantile Exchange in 1983. The previous settlement high was $61.89 a barrel set Tuesday.
Oil futures rose as high as $62.45 on Friday, a nickel shy of the intraday peak set earlier in the week.
Nymex gasoline futures rose 2.99 cents to settle at $1.8322 a gallon, an increase of 5 percent from a week ago.
"We'll break the all-time records next week" at the retail level, said Tom Kloza, director of Wall, N.J.-based Oil Price Information Service. The record high was $2.33 per gallon, established the week ending July 8. Adjusting for inflation, retail gasoline prices peaked above $3 a gallon in 1981.
Kloza said that retailers around the country are telling him that there are no signs of demand tapering off.
In other Nymex trading, heating oil futures rose 2.34 cents to $1.7312.
September Brent futures rose 63 cents to $60.75 a barrel on London's International Petroleum Exchange.
Over the past few years, rising oil consumption has strained the world's limited excess production capacity, putting energy traders on edge about any threat to supply.
For example, the death of Saudi Arabia's king helped rattle markets on Monday, even though the transition to a successor was smooth and the country's oil policy is not expected to change.
Markets were unsettled by an array of concerns on Friday, ranging from breakdowns in U.S. refineries in the past two weeks to ongoing worries that heating oil supplies will be tight in the fourth quarter.
The U.S. Energy Department report this week showing declines in gasoline inventories exacerbated already heightened fears that overworked U.S. refiners may not quickly recover from shutdowns to bump up gasoline supplies.
"Looking at the overall refinery situation, I think people are still having jitters from all the recent destruction we've seen in the U.S.," said Jonathan Copus, energy analyst with Investec Securities in London.
At least seven refineries have reported problems of one kind or another, ranging from fires at Chevron Corp.'s El Segundo, Calif., and BP PLC's Texas City refineries to the complete shutdown of Exxon Mobil's plant in Joliet, Ill.
The latest economic news out of the U.S. indicating that payrolls expanded by 207,000 in July, the highest reading in five months, also supported bullish sentiment.
Markets were concerned that a growing economy, supported by higher payroll figures, could filter through to oil demand growth.
Aging refineries in the U.S. are running near full capacity and this increases the likelihood of operational problems.
"Rapidly falling gasoline stocks and refineries' emphasis on turning out distillates add to gasoline worries," New York-based Energyintel analyst John van Schaik said in a research note.
U.S. gasoline inventories declined by 4 million barrels to 205.2 million barrels, or 3 percent below last year's level. The supply of distillate fuel, which includes heating oil and diesel, rose by 1.5 million barrels to 127.3 million barrels or 5 percent above last year.
Despite high oil prices, strong demand has been bolstered by perceptions the global refining system was severely over-stretched, analysts said.
"There's a lot of trading activity in the oil market that's supporting prices, it's a reflection of concerns that the refining supply cushion is thin," said Lorraine Tan, research director at Standard & Poor's Investment Services in Singapore.
Crude prices would still have to surpass $90 to reach the inflation-adjusted high set in 1980. |
