Heating Oil Prices Up Again

The price of heating oil jumped again Wednesday as bitterly cold weather continued to hover over much of the country, giving rise to concerns about transport problems and dwindling supplies.

But oil traders said they saw signs that the rally was starting to weaken.

Heating oil for January finished up a sharp 7.23 cents at 99.71 cents a gallon on the New York Mercantile Exchange after retreating from a session high of 100 cents. The contract had surged 13% Tuesday, the first day of trading since a Christmas Eve explosion at an Exxon refinery in Louisiana.

The February contract rose its expanded 3-cent daily limit to 73.89 cents on the Mercantile Exchange.

Most futures contracts have daily price limits to prevent panic buying or selling. After the February contract rose its 2-cent limit on Tuesday, the exchange expanded the range for Wednesday’s session.

The freezing weather not only raised demand for heating oil, but it also made it difficult to distribute supplies as barges became stranded in rivers that iced over.

Meanwhile, elected officials from states in the Northeast have asked the federal government to investigate skyrocketing home heating oil prices, including possible price manipulation.

The price for a gallon of home heating oil has risen to as high as $1.62 from about 85 cents two weeks ago. As record cold gripped New England, prices in the region were routinely jumping 5 cents per gallon per day; in one instance, the jump was 12 cents.