Heating oil stocks continue to fall

4 October 2007

Information contained in a US government report about the stock of heating oil in the country is worrying, according to a market analyst.

The Energy Information Administration's weekly report was expected to show that stocks of distillates are rising ahead of the peak demand for heating oil during the winter months.

Instead it revealed that the stockpile had fallen by another 1.2 million barrels, meaning it is 15.6 million barrels below the level of 12 months ago.

Commenting on the figures, Phill Flynn of Alaron Trading said: "What is extremely worrisome in this report is the drawdown in distillates inventories because they're still well below year ago levels at this point ... and I think that's critical."

The news comes just days after the National Energy Assistance Directors' Association predicted that heating oil customers in the US are likely to face 28 per cent higher heating bills this winter than last, because of a steady rise in the value of crude oil during 2007.