Oil Prices Rise Slightly, but Gas Drops

By GEORGE JAHN

VIENNA, Austria – Energy futures prices were mixed on Thursday after a U.S. petroleum supply snapshot showed rising supplies of oil and refined products. The market remained tense over the Iranian nuclear dispute and political unrest in Nigeria.

The U.S. Energy Department report showed domestic crude-oil inventories grew by 2.7 million barrels last week to 321.4 million barrels, or 12 percent above year ago levels. Gasoline inventories expanded by 2.8 million barrels to 211.6 million barrels, or 3 percent below year ago levels. The supply of distillate, which includes heating oil and diesel, increased by 900,000 barrels to 134.7 million barrels, or 8 percent above last year.

Light sweet crude for February delivery rose 2 cents to $65.75 a barrel in early trade on the New York Mercantile Exchange.

The contract had fallen 58 cents Wednesday to close at $65.73 as traders took profit from a recent run-up in prices over jitters about potential disruptions to crude-oil supply from Iran and Nigeria.

At London’s ICE Futures exchange Thursday, March Brent crude rose 31 cents to $64.50 a barrel.

Worries of possible sanctions against Iran, OPEC’s second-largest producer for its nuclear ambitions and violence in oil-rich Nigeria helped drive oil prices up more than $2 a barrel on Tuesday.

Nigerian supplies have been disrupted by violence in Africa’s leading oil exporter and the fifth-biggest crude-oil supplier to the United States.

But the market seemed to breathe a little easier about the U.S. supply of refined products. Gasoline futures fell 2.33 cents to $1.75 a gallon, while heating oil futures fell by less than a penny to $1.755 a gallon. Nymex natural gas futures edged 9.4 cents lower to $8.60 per 1,000 cubic feet.

Concerns over geopolitical risks may have only receded temporarily.

"The Nigerian crisis remains a serious issue."

Vienna’s PVM Oil Associates reported, meanwhile that crude oil exports from Iran to the Ceyhan terminal resumed at a rate of about 200,000 barrels a day, following repairs to pipelines attacked late last year.

"In the next days, exports are expected to increase to 400,000 barrels a day," PVM said in its daily energy market report.

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Associated Press Writers Brad Foss in Washington and Gillian Wong in Singapore contributed to this report.