Oil price rises on superstorm threat to supplies

Associated Press Modified: October 31, 2012 at 8:46 am •  Published: October 31, 2012
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Oil prices rose Wednesday on concerns about near-term oil supplies in the U.S. following a fierce storm that caused havoc across the northeastern part of the country and was threatening to inflict more damage inland.

By early afternoon in Europe, those concerns helped benchmark crude for December delivery rise 65 cents to $86.33 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 14 cents to finish at $85.68 a barrel in New York.

In London, Brent crude, used to price many international varieties of oil, was up 38 cents to $109.46 per barrel on the ICE Futures exchange.

A hurricane that evolved into a winter superstorm, Sandy cut power to more than 8 million homes, shut down 70 percent of East Coast oil refineries and inflicted worse-than-expected damage in the New York metropolitan area. That area produces about 10 percent of U.S. economic output.

Sandy came ashore Monday evening in New Jersey, dumped heavy rain inland in Pennsylvania on Tuesday and was expected to turn toward New York state and Canada overnight.

The storm will end up causing about $20 billion in property damages and $10 billion to $30 billion more in lost business, according to IHS Global Insight, a forecasting firm.

Widespread power outages and transportation disruptions, and hazardous driving conditions would likely reduce demand for energy. But analysts said crude imports will likely be reduced until East Coast ports reopen.

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