ENERGY : Rising Oil Supplies, Weak Demand Push Price Down

Oil prices finished slightly lower Friday, capping a week that pushed the market down on news that U.S. supplies are rising while demand remains sluggish.

There was no notable pattern to Friday’s trading, with the energy futures drifting up and down in light volume at the New York Mercantile Exchange.

Light, sweet crude oil for delivery in July settled at $20.28 per barrel, down 5 cents for the day and 85 cents for the week.

Unleaded gasoline for delivery in July settled at 64.28 cents a gallon, down 0.16 cent. Home heating oil for delivery in July settled at 53.79 cents a gallon, down 0.41 cent.

For the week, gasoline for next-month delivery fell 2.63 cents, while heating oil for next-month delivery fell 2.69 cents.

The week’s plunge dragged gasoline futures to their lowest prices since shortly after U.S.-led forces began the ground war with Iraq in late February.

The market had begun moving lower early in the week, as it became clear that the Organization of Petroleum Exporting Countries would not tinker with current production quotas.

Concerns that the oil ministers might come up with a surprise at their meeting in Vienna had kept the market propped up, and after nothing happened during Tuesday’s session, prices began falling.

The drop accelerated when the American Petroleum Institute reported that the nation’s supply of crude oil and refined products showed sharp increases in the previous week.

Analysts said oil companies had pushed their refineries into high gear, and supply was apparently outstripping demand, which has been weakened by the recession.

“The oil market found a new trend,” said Peter Beutel, an oil analyst at Pegasus Econometric Group Inc., in Hoboken, N.J. “It had been listlessly trading in a range, then the OPEC meeting dissolved itself without any concrete decisions being made. Then, the API numbers came out that evening and showed big increases in supplies, while demand, below that of a year ago, stayed the same.”