Oil price up as US refineries restart after storm

Friday, October 26, 2012, Vol. 36, No. 43
PABLO GORONDI, Associated Press

The restart of refineries in the storm-hit northeastern United States gave a small boost to crude oil prices on Thursday.

By early afternoon in Europe, benchmark oil for December delivery was up 14 cents to $86.38 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 56 cents to finish at $86.24 a barrel in New York.

Because refineries use and process crude oil, their reopening nudged up the price for the commodity.

Nine oil refineries that make up 8 percent of U.S. refining capacity sit in the region hit by Superstorm Sandy. Nearly all were affected by the storm, but all but two resumed operations late Wednesday.

Meanwhile, the American Petroleum Institute said crude oil stocks rose by 2.1 million barrels to 371.7 million for the week ending Oct. 26. However, crude supplies in the Mid-Atlantic region were reported to be 16.5 percent below the five-year average, said analyst and trader Stephen Schork,

"The market's concern regarding supply disruptions is growing," lending support to oil prices, Schork said.

Some analysts were optimistic that a string of U.S. economic indicators due to be released later Thursday and Friday, including weekly jobless claims, the ADP private payrolls survey, a monthly manufacturing survey and nonfarm payrolls data for October, would also boost markets.

"We are confident that oil prices will make further gains in the coming days," said a report from Commerzbank in Frankfurt. "After all, if economic indicators stabilize or improve, hopes of a revival of oil demand will also increase."

Brent crude, which is used to price international varieties of oil, fell 55 cents to $108.15 per barrel in London.

In other trading:

- Heating oil fell 3.22 cents to $3.0301 per gallon.

- Natural gas was up 1.9 cents to $3.711 per 1,000 cubic feet.

- Wholesale gasoline rose 0.9 cents to $2.6393 per gallon.