Singapore, August 12:
Crude oil prices on Friday rose to new highs, climbing past $66 a barrel, as reports of new US refinery outages rekindled fears that gasoline supplies in the worldâ€™s biggest consumer would struggle to meet rising demand. Midmorning in Singapore, light, sweet crude for September delivery rose as high as $66.10 a barrel in Asian electronic trading on the New York Mercantile Exchange. It then slipped back a bit to $66.08, up 28 cents. On Thursday, crude touched the $66-a-barrel mark before settling at $65.80, up 90 cents on the day. Gasoline rose 1.3 cents to $1.9630 a gallon (3.8 litres) while heating oil rose a cent to 1.9097.
Analysts said gasoline demand, currently at its peak in the US summer driving season, was driving crudeâ€™s gains. Last week, US gasoline demand picked up by 1.4 per cent from a year ago, according to government data.
Coupled with new reports of refinery outages this week, traders fear US refiners, already running at near-maximized capacities, are straining to satisfy the rising demand. â€œPeople fear there wonâ€™t be enough gasoline at a time when itâ€™s so greatly demanded, so theyâ€™re just buying, buying and buying,â€ said Tetsu Emori, chief commodities strategist at Mitsui Bussan Futures in Tokyo. Oil prices are almost 50 per cent higher than a year ago, but they would need to surpass $90 a barrel to exceed the inflation-adjusted peak set in 1980. The US Energy Department said on Wednesday gasoline inventories fell 2.1 million barrels to 203.1 million last week. â€œThe refinery breakdowns are a big issue,â€Emori said.