*Crude oil prices on the "electronic" exchanges may have dropped but it's not cycling through to gasoline, the 4 closest gas stations to my house now average $3.40/gallon for the lowest-grade of gasoline... this is a record folks...
Crude Oil Prices Drop Tuesday September 6, 1:16 am ET By Christopher Torchia, Associated Press Writer Oil Prices Fall After Nations Take Steps to Avert Fuel Shortage
SINGAPORE (AP) -- Oil prices dropped Tuesday amid continued relief after last week's decision by industrialized nations to release 60 million barrels of crude from strategic stockpiles as the U.S. oil industry struggles to recover from Hurricane Katrina.
Late morning in Singapore, light crude oil for October delivery was down 97 cents to $66.60 a barrel in electronic trading on the New York Mercantile Exchange, which was closed Monday for Labor Day. The contract closed Friday at $67.57 a barrel.
Unleaded gas was down nearly 8 cents to $2.10 a gallon, while heating oil was down 4 cents to $2.04 a gallon.
Also Tuesday, the Japanese government unveiled plans to release some of its strategic oil reserves held by refiners to the oil market.
Shoichi Nakagawa, Minister of Economy, Trade and Industry said the country will start releasing about 200,000 barrels a day of crude oil and refined products from its oil reserves held by refiners to the market from Wednesday.
"We are not planning to release any government-controlled crude oil stocks at this time," Nakagawa said.
The International Energy Agency announced Friday that its 26 members, including Japan, would draw on 2 million barrels a day of oil over the next 30 days to help offset the loss of output and refining capacity in the U.S. caused by Hurricane Katrina, and restore confidence in the market.
Two storm-shuttered facilities in the United States restarted and flows of crude oil improved enough to allow refineries in the Gulf Coast and Midwest to ramp up production. But four damaged Gulf Coast refiners look likely to remain shut for weeks or even months, taking with them more than 5 percent of U.S. capacity.
Despite the steps by industrialized nations to avert a fuel shortage, analysts warned that long lines at U.S. gasoline pumps and record prices could augur higher oil costs in the months ahead.
"With nearly three months to go until the end of the Atlantic hurricane season, which peaks between mid-September and mid-October, more storms -- both real and metaphorical -- could be on the horizon," Energy Intelligence said on its Web site.
Rafael Ramirez, Venezuela's oil minister, said his country will follow through on its offer to send 1 million barrels of gasoline to the United States as soon as possible to help victims of Hurricane Katrina. Ramirez reiterated the pledge on Monday while at an oil meeting in Jamaica.
Venezuela and Caribbean leaders are close to finalizing deals to supply the region with oil from the South American nation under preferential terms.
Venezuelan President Hugo Chavez was to meet Tuesday in Jamaica with officials from 16 Caribbean countries, and was expected to sign accords establishing the financing and other details of his Petrocaribe initiative.
Chavez has said Venezuela, the world's fifth largest oil exporter, will donate nearly $20 million to help islands build loading docks and fuel storage depots so they can easily receive fuel.
Chavez's critics accuse him of using "oil diplomacy" to pursue political aims and line up allies for his frequent clashes with the U.S. government. Some opponents have also accused him of giving Venezuela's oil away.
It could be worse they could do like Wal-Mart did. Forced to close 123 stores in the area they donate $15 million dollars and then roll in mobile Wal-Mart trucks to SELL the victims basic need products like food and basic hygiene products.
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