As supply fears ease crude oil prices slide

15-Feb-05

Yesterday, oil prices had soared more than 2 US dollars a barrel as government and private surveys showed tight commercial inventories of crude oil and heating oil. After a drastic jump yesterday, the market softened. A price hike triggered by fears of tight energy supplies in the northeastern United States came to a halt as world crude oil prices slipped. New York's main contract, light sweet crude for delivery in January was at US$44.18 a barrel. Another factor that had sent prices shooting was news that Colonial Pipeline was rationing access to the pipeline, which moves refined product from Cushing, Texas to the northeastern states. However, Colonial Pipeline expalined that rationing on the major pipeline network was not unusual when fuel demand picked up in the run-up to the northern hemisphere winter.