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Oil prices fall as storm pounds northeastern U.S. East Coast

By: Pamela Sampson, The Associated Press

Posted: 10/29/2012 5:09 AM | Comments: 0 | Last Modified: 10/30/2012 1:58 AM

A stranded car sits parked along a street near downtown Norfolk, Va., Monday, Oct. 29, 2012. Rain and wind from Hurricane Sandy are hitting the area. (AP Photo/Steve Helber)

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BANGKOK - Oil prices fell Tuesday while a massive storm was pounding the heavily populated U.S. East Coast, reducing demand for fuel by keeping drivers off roads, closing businesses and silencing activity in New York City and other metropolitan areas.

Benchmark oil for December delivery fell 31 cents in midday Bangkok time to US$85.23 per barrel in electronic trading on the New York Mercantile Exchange.

Crude oil prices fell 74 cents, or 1.3 per cent, to finish at $85.54 a barrel Monday. The Nymex was closed for the day because of the storm, but electronic trading continued.

The biggest refineries in the northeastern United States shut down or throttled back sharply on Monday as the storm came ashore into New Jersey and hurled seawater at New York City, closing U.S. financial markets.

Analysts said the impact on demand, with power outages and the shutdown of major cities, could be significant.

Oil analyst Stephen Schork said in an email commentary that "with lower Manhattan in the dark, roads from Connecticut to Delaware closed and refineries shut, the lack of implied demand is overshadowing ... potential supply disruptions from Sandy."

In London, Brent crude, which is used to price international varieties of oil, fell 52 cents per barrel to $108.92.

In other energy futures trading in New York:

— Heating oil fell 1.3 cents to $3.0744 per gallon.

— Wholesale gasoline fell 0.3 cents to $2.673 per gallon.

— Natural gas fell marginally to $3.80 per 1,000 cubic feet.

(TSX:ECA, TSX:IMO, TSX:SU, TSX:HSE, NYSE:BP, NYSE:COP, NYSE:XOM, NYSE:CVX, TSX:CNQ, TSX:TLM, TSX:COS.UN, TSX:CVE)

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