Oil Falls to $50.50 PB

http://cnn.netscape.cnn.com/ns/news/story.jsp?id=2005041311000001586141&dt=20050413110000 ^ | 4/13/05 | conservativeinferno

[conservativeinferno]

Oil Prices Drop More Than $1 a Barrel

SINGAPORE (AP) - Oil prices dropped more than $1 a barrel Wednesday morning after U.S. government data showed that supplies of crude oil and gasoline grew last week.

On Tuesday, oil prices fell by nearly $2 a barrel after the International Energy Agency forecast slower demand growth this year.

Light, sweet crude for May delivery fell $1.36 to $50.50 a barrel in morning trade on the New York Mercantile Exchange. On the International Petroleum Exchange in London, Brent crude fell 70 cents to $51.28 a barrel.

The U.S. Department of Energy said that the nation's supply of crude oil grew last week by 3.6 million barrels to 320.7 million barrels. It was the ninth straight week in which U.S. oil inventories increased.

Gasoline inventories increased by 800,000 barrels to 213.1 million barrels, the agency said, while the supply of distillate fuel, which includes heating oil and diesel, slipped by 100,000 barrels to 104.0 million barrels.

Heating oil prices fell more than a cent to $1.4535 a gallon, while unleaded gasoline futures fell more than a cent to $1.5190 a gallon.

Also weighing on the market was Tuesday's report by the International Energy Agency.

``The IEA report raised doubts about demand expectations. The market was ready to bounce back up and the bulls were confident that demand would be strong,'' said analyst Phil Flynn at Chicago-based Alaron Trading Corp. on its Web site. ``Now they are losing that confidence. The bulls are jumping ship.''

In its report, the Paris-based IEA suggested that rising U.S. interest rates and energy costs would reduce global demand growth for oil this year by 50,000 barrels a day to 1.77 million barrels a day. The global energy watchdog also said slowing Chinese oil demand growth might...(cont.)

[2 Kool 2 Be 4-Gotten]

Wow, that's interesting - you know I did wonder why there are a lot of small operators in this business as opposed to a few big ones. I guess it didn't just happen this way. Is this a federal law or a state law? BTW I happen to know that NJ is a state that has some interesting differences with the rest of the country (I don't live there but have been through it).

It seems that the state cut of the gas price is lower in NJ thus lowering prices there thus encouraging people from other states to go there to fill up.

OTOH to some greater or lesser extent they don't have self service in NJ - it must be full service. I think this may only apply to the NJ Turnpike stations and not all stations in NJ but it is certainly true when you gas up on the NJ turnpike.

I also think (as has been pointed out many times before) that a lot of the problem is a shortage of refinery capacity AND the myriad of individual state requirements as to how each state wants their gas formulated.

If I were king of the world I would build more refineries and define one standard for gas that would apply in all 50 states.