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UPDATE 1-U.S. retail heating oil hits record $3.85/gln-Govt

Wed Mar 19, 2008 11:28pm IST
 
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(Adds EIA comments)

WASHINGTON, March 19 (Reuters) - The average price U.S. consumers paid for heating oil rose 17.5 cents over the last week to a record $3.85 a gallon, the government said on Wednesday.

The national heating oil price was up $1.36 from a year ago, the U.S. Energy Information Administration said in its weekly survey of heating fuel costs around the country.

U.S. fuel dealers asked the Bush administration to release emergency heating oil supplies held by the government to ease prices.

Heating oil prices are rising because of expensive crude oil, which hit a record high of $111.80 a barrel this week.

"High crude oil prices have been an important factor underlying high petroleum product prices this season, including residential heating oil," the EIA said in its weekly review of the oil market.

In addition to crude costs, the agency said tight heating oil supplies have also helped to push up prices.

"Inventories, particularly in New England and the Middle Atlantic regions, remain at relatively low levels, reflecting the strong global market for distillate fuels," the EIA said.

Consumers generally should soon see a break in heating oil prices as spring begins this week and warmer weather starts arriving. However, the EIA said the U.S. Northeast, which is the world's largest heating oil market, normally has strong heating fuel demand through April, "keeping pressure on markets for a bit longer." (Reporting by Tom Doggett; Editing by Christian Wiessner)

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