Oil Supply Crunch as Almost Half Of US Refining Remains Shut Down

Inventories of distillate fuel, which include diesel and heating oil, slid by 4.2 million barrels to 125.4 million barrels for the week ended Sept. 19. Analysts expected distillate stocks to decrease by 1.8 million barrels.

NVDL: I've lost count how many times 'analysts' have underestimated supply. But think about - 40% of US refining capacity remains shut down. That's almost half.

clipped from biz.yahoo.com NEW YORK (AP) -- Oil prices rose near $108 a barrel Wednesday as traders shifted focus from U.S. economic woes to tightening global crude supplies amid a drop in output from the Gulf of Mexico and overseas. In recent days, however, steadily shrinking world crude supplies have grabbed the market's attention. About 66 percent of oil production and 61 percent of natural gas output in the Gulf of Mexico remains shut-in after the passage of Hurricanes Gustav and Ike, according to the U.S. Minerals Management Service. The Gulf area is home to a quarter of U.S. oil production and 40 percent of refining capacity. OPEC's decision earlier this month to cut production by 520,000 barrels a day and militant threats to Nigerian oil supplies have added to the supply crunch.