Updated on 10/3/00 - 9:25:00 AM EST Low Distillate Inventories Worry Analysts

Low distillate inventories, which have worried oil market analysts all summer, continue to be a concern as the winter season approaches.

Bloomberg News reported Sept. 27 that an unexpected decline in U.S. inventories of fuel and crude oil had increased concern that refiners wont make enough heating oil to meet demand in the Northern Hemisphere winter.

According to the American Petroleum Institute, distillate stocks fell 761,000 barrels, or 0.7%, and failed to meet market expectations of a 1.5-million-barrel rise.

However, API  the trade association that represents the nations oil and natural gas companies  said the inventory levels are not really a problem, and besides, they are not all that low.

http://www.ttnews.com/members/topNews/0005748.html

-- Martin Thompson (mthom1927@aol.com), October 04, 2000

Answers

API always has a good yawn about their own low inventry figures. I don't know why.

-- Uncle Fred (dogboy45@bigfoot.com), October 04, 2000.

I, too, have been puzzled by API statements for several months. One possible explanation is to think of the situation this way: If inventories fall, prices rise. If prices rise, profits rise. If you are an oil producer, why is this a problem? Just a thought.

-- Stuart (umpleby@gwu.edu), October 05, 2000.