Slide 8 of 17
This chart shows the day-to-day volatility in spot crude and heating oil prices, and clearly shows the regional nature of the price spike that occurred last winter.
Due to a combination of extreme cold weather, low inventories, and refinery and transportation problems, New York Harbor spot prices shot up as high as $1.77 per gallon in a brief period in late January and early February.
In June of this year, distillate spreads had dropped to 2.5 cents per gallon as a result of crude oil prices increasing faster than product prices. But by August spreads had strengthened to about 15 cents, and were as high as 21 cents on average in November 2000, which is almost 15 cents above average -- reflecting continued low stocks and the lack of even a normal summer/autumn build in inventories.
Itís interesting to note that even with last winterís short-lived price spikes, the monthly average New York Harbor spot prices in January and February were lower than those weíve had since September. The difference is that crude oil prices have been considerably higher this fall.