Big draw in gas supply sends energy prices jumping

DENVER — Evidence that refiners severely curtailed their production of gasoline over the past week sent energy prices jumping across the board.

The Energy Information Administration reported Thursday that gasoline in storage fell by more than 5 million barrels at a time when most energy experts expected supplies to grow yet again. Oil prices hit a new high for the year.

Consumers may see a bump upward in pump prices but only a slight one, experts believe, because gas supplies greater than what they usually are at this time of the year and demand is still low due to the recession.

The average national price for retail gasoline has been drifting lower for two months. That price ticked up slightly overnight, according to auto club AAA, Wright Express and Oil Price Information Service.

Pump prices rose less than a penny to $2.487 per gallon, which is 7.6 cents less than last month at this time and well below the summer peak of $2.69 reached in June. Last year at this time, a gallon of gas cost $3.12.

“This is probably enough to drift up a little bit but it should not be the first step on the march back to $3,” oil analyst Tom Kloza said.

Refiners have been idling facilities because of a lack of demand at the same time that others have been shut down for routine maintenance.

Besides the report on gasoline, the dollar hit a 52-week low on Thursday, which may have also contributed to the run-up in energy prices.

“The ignition switch for a rally got hit twice today,” Kloza said.

Crude and gasoline prices have remained relatively stable for months with no clear signs of an economic rebound. But prices began to rise late last week when Alcoa, which kicks off the U.S. earning season, reported that it had returned to profitability after three straight quarterly losses.

One day after jumping above $75 per barrel for the first time this year, benchmark crude prices rose another $2.40 to settle at $77.58 on Thursday. At one point, prices were 3 cents shy of $78 per barrel.

While the government reported that crude placed into storage grew again last week, it wasn’t as big of a build up as many experts had expected and that may have helped push prices higher as well.

Natural gas inventories also grew, the EIA reported Thursday, and levels now sit nearly 15 percent above the five-year average.

Despite an uptick in prices, consumers should still be in for a relatively cheap winter as far as heating the home.

“The good news here is that heating oil distributors and natural gas distributors for that matter, too, were building stocks this past summer when prices were at their lowest,” said analyst Stephen Schork. “They’re sitting on cheap inventory so you’re not going to see a major spike in heating costs.”

The EIA has forecast an 8 percent drop in heating bills this winter. The government reported that heating oil prices rose 3 cents last week to $2.53 per gallon. Last year at this time, a gallon of heating oil cost $3.39.

Heating oil futures rose 7.53 cents to settle at $2.0181 a gallon while natural gas for November delivery rose 4.6 cents to settle at $4.482 per 1,000 cubic feet. Gasoline for November delivery gained 8.74 cents to settle at $1.9449 a gallon.

In London, Brent crude rose $1.35 to settle at $74.45 on the ICE Futures exchange.

Associated Press writers Alex Kennedy in Singapore and George Jahn in Vienna contributed to this report.