5 August 2005, 11:19  Oil within $1 of record-peak amid US refinery snags

Oil climbed on Friday to within $1 of its all-time high as more U.S. refiners suffered unexpected outages that would stymie efforts to meet strong demand growth in the world's biggest consumer. U.S. light sweet crude was up 22 cents to $61.60 a barrel in Asian trade, having closed 52 cents higher on Thursday, its fifth gain in the past six sessions. London Brent crude gained 38 cents to $60.50 a barrel, 76 cents off the record-high of $61.26 struck this week. "It's no secret that refineries are the problem. There wouldn't be a problem if there was any slack in the system," said Tony Nunan, a manager at Mitsubishi Corp.'s international energy business in Tokyo. A half-dozen refineries in the United States have been forced into unplanned shutdowns since late July and some have had to delay planned restarts, leaving the market on edge after U.S. gasoline stocks fell a sharp 4 million barrels last week. Inventories have now fallen into the lower half of their seasonal average, while demand is running 1.1 percent stronger than last year with a month left in the summer season. Supplies of distillates, which include heating oil, rose 1.5 million barrels to stand almost 3 percent higher than a year ago, but even stronger demand growth for these fuels coupled with refinery trip-ups could dent supplies before winter. "Demand is so high and capa от city is so low, we can go from comfortable to uncomfortable inventories within a month," Nunan said. Sunoco Inc.'s 150,000-barrel-per-day (bpd) refinery in Toledo, Ohio, failed to restart on Thursday, while the restart of Exxon Mobil Corp.'s 245,000-bpd plant in Joliet, Illinois, was expected to be delayed, trading sources said. They said BP Plc. had delayed the restart of both of its downed fluid catalytic crackers at its Texas City, Texas, refineries. Additional disruption could come from an unusually active Atlantic hurricane season, which has already produced eight named storms and could culminate in as many as 21 tropical storms and 11 hurricanes, U.S. government weather forecasters have said.

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