US Cash Products-NYH heat oil surges amid tight supply

NEW YORK, March 14 (Reuters) - Cash heating oil price differentials surged in the New York Harbor on Friday amid market talk of tight supplies and a regional refiner caught short of barrels due to an outage.

"Quite simply the market is tight on heating oil," said a distillates trader who covers the New York Harbor.

The rise comes atop strong gains on Thursday and left outright prices sharply higher as front month NYMEX heating oil futures surged to a record $3.222 per gallon on Friday.

Talk that ConocoPhillips may have an outage at the company's Bayway refinery in Linden, New Jersey helped drive a spike in heating oil futures on Thursday, noted Tim Evans, an analyst at Citi Futures Perspectives.

Conoco officials could not immediately comment. Conoco had planned to shut the crude distillation unit and reformer at its 238,000 barrel-per-day Bayway refinery in early March for three weeks' work, traders said in mid-February. [ID:nN11645230]

Heating oil prices were also been widely supported "by talk of exports to a more genuinely tight European market," Citi's Evans said in a note.

Stockpiles of heating oil fell sharply last week, especially in the New England section of PADD 1 East Coast region, a key market for the fuel, the Energy Information Administration (EIA) said Wednesday.

U.S. crude oil futures flat-lined but heating oil futures were up sharply, also on talk of a large refiner or financial player caught short, traders said.

For NYMEX reports click [O/N]