Path: bloom-picayune.mit.edu!snorkelwacker.mit.edu!news.media.mit.edu!americast.com!americast.com!usa-post Newsgroups: usa-today.energy From: usa-post@AmeriCast.Com Organization: American Cybercasting Approved: usa-post@AmeriCast.com Subject: energy Thu, May 28 1992 Date: Thu, 28 May 92 05:21:26 EDT Message-ID: 05-28 0000 DECISIONLINE: Energy USA TODAY Update May 28, 1992 Source: USA TODAY:Gannett National Information Network HOUSE PASSES ENERGY BILL: The House Wednesday passed its version of a national energy strategy. The House voted 381-37 for the bill, which is designed to spur the USA toward efficiency and conservation. It also would encourage nuclear power and open electricity generation to competition. The Strategic Petroleum Reserve would be increased from 570 million barrels of oil to 1 billion under the bill. OIL INDUSTRY WINS A ROUND: The oil industry won a round Wednesday with the passage of the House energy bill. The House passed the bill after earlier rejecting a proposal to make oil refiners and importers pay for increasing the Strategic Petroleum Reserve. The House and Senate energy bills now go to a conference committee. The final version is expected to be passed and sent to President Bush by late summer. OIL PRICES FALL BACK: Oil prices steadied Wednesday, giving back some of Tuesday's $1-a-barrel jump. Crude oil for July delivery fell 8 cents to $21.92 a barrel on the New York Mercantile Exchange. Tuesday, oil prices jumped $1.06 to $22 a barrel as traders reacted to news that Saudi Arabia was no longer resisting the call by other Organization of Petroleum Exporting Countries members for higher oil prices. (For more, see special Oil package below.) MINERS' CARE PROVISION REJECTED: The House agreed Wednesday by a voice vote to an amendment that would to extend a tax on coal production to reclaimed abandoned mine lands. Rep. Nick J. Rahall, D-W. Va., originally proposed earmarking $50 million of the money for two United Mine Workers health-care funds, currently running a $100 million deficit. Under the accepted proposal, the tax would be extended to the year 2010. OIL STOCKS ACTIVE: The strongest activity on Wall Street Wednesday was in oil stocks, which have been rising for two months and surged Tuesday as crude prices rose. Wednesday, investors sold oil shares to lock in profits. Exxon sank 2 1:4 to $61 3:4, Texaco lost 2 1:8 to $64 5:8, and Chevron dropped 1 5:8 to $71. Atlantic Richfield dipped 2 1:2 to $115 1:4 even though Oppenheimer and Dean Witter rated it a buy. N.Y. UTILITIES TO BREAK GROUND: Brooklyn Union Gas, Con Edison and the U.S. Coast Guard will begin drilling Friday for a pipeline to transport natural gas from Brooklyn to Governors Island. The project marks the first use of horizontal drilling for a gas pipeline in New York City. The Coast Guard, which maintains its Atlantic Area headquarters on Governors Island, is converting its 120 buildings there from oil to gas. AMOCO CUTS 1992 CAPITAL BUDGET: Amoco Corp. said Tuesday that it is reducing its capital and exploration budget for 1992 by 12% to $3.3 billion due to the economic challenges facing the oil and gas industry. Chairman H. Laurance Fuller said the $430 million decrease in Amoco's $3.7 billion will impact projects that can be deferred in Amoco's exploration and production, chemicals, and refining operation. ANGUS SETTLES WITH INSURER: Industrial Risk Insurers has agreed to pay ANGUS Chemical Company, a subsidiary of Alberta Natural Gas Company Ltd., $150 million to settle ANGUS' claim for damage and loss from an explosion at the ANGUS specialty chemicals plant in Sterlington, La., it was announced Wednesday. The portion of the plant which produces nitroparaffins was heavily damaged in the blast last year. RED EAGLE ANNOUNCES JOB CUTS: Red Eagle Resources Corp. Wednesday announced the layoff of 275 Oklahoma employees, representing an annual payroll of over $7 million dollars. Red Eagle's wholly owned subsidiaries, United Drilling Co. and Talon Trucking Co., will be scaled back to the size needed to meet only the needs of Red Eagle's exploration and production company, Cimarron Operating Co. SPECIAL PACKAGE ON OIL: REFINED PRODUCTS FALL: During Wednesday's uncertain session at the N.Y. Merc, light sweet crude traded as high as $22.21 a barrel and as low as $21.80 on the July delivery contracts. Unleaded gasoline for June delivery settled at 65.44 cents a gallon, down .83 cent. June home heating oil fell .32 cent to 59.31 cents a gallon. Natural gas for July delivery settled at $1.590 per 1,000 cubic feet, down 4.0 cents. ANALYSTS DIFFER ON PRICE COURSE: Analysts differ on the direction oil prices will take. Oil and financial markets overreacted Tuesday to the Saudi announcement, insists Peter Beutel, energy director at Pegasus Econometric Group. "I still think we're close to a top" in prices, he says. George Gaspar, analyst at stockbroker Robert W. Baird & Co., expects oil to trade at $23 to $25 a barrel by the fourth quarter. U.N. MOVE COULD AFFECT PRICES: "I sense that the oil-price run is not over. The pullback could last another day or two, but I think oil prices, and oil stock prices, are going to go higher," Gaspar says. Prices should climb slowly this summer, says Tom Bentz of United Energy. "The one thing that would turn (prices down) in a heartbeat is if the (United Nations) allows Iraq to start pumping and exporting." (End of package.) Energy Editor: William Snoddy. (1-919-855-3491) Making copies of USA TODAY Update (Copyright, 1992) for further distribution violates federal law. This article is copyright 1992 Gannett News Service. 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