Sept. 29 (Bloomberg) -- Crude oil was little changed after surging yesterday on speculation U.S. supplies will decline after Hurricane Rita shut refineries and offshore platforms.

All oil production in the Gulf of Mexico remained shut yesterday, while natural gas output was 80 percent below normal. Eleven refineries along the Gulf of Mexico are closed because of Rita and Hurricane Katrina, which struck last month. Oil stockpiles fell more than expected last week, a U.S. Energy Department report showed yesterday.

``It looks as if these platforms and refineries are going to be out for a lot longer than previously thought,'' said David Thurtell, a commodity strategist at Commonwealth Bank of Australia in Sydney.

Crude oil for November delivery was at $66.25 a barrel, down 10 cents, or 0.2 percent, at 7:22 a.m. Singapore time. Yesterday, prices rose $1.28, or 2 percent, to $66.35. Futures have declined 6.6 percent since touching a record $70.85 a barrel on Aug. 30, the day after Katrina made landfall. Prices are 34 percent higher than a year ago.

Gasoline for October delivery traded at $2.30 a gallon, down 3.93 cents, or 1.7 percent, in after-hours trading at 7:09 a.m. Sydney time. Yesterday, the contract jumped 17.29 cents, or 8 percent, to $2.3393, the highest since Sept. 1. The contract earlier reached $2.35, the highest intraday price since Sept. 2. Futures are 72 percent higher than a year ago.

Gasoline

Gasoline prices extended their gains yesterday after the Energy Department reported that supplies rose 4.4 million barrels to 199.8 million in the week ended Sept. 23. A 2.25 million barrel decline in gasoline inventories was expected, according to the median of forecasts by 14 analysts.

``There's good reason to be worried because so much refining capacity is off the market right now,'' said Tom Bentz, an oil broker with BNP Paribas Commodity Futures Inc. in New York. ``Nothing appears to be improving at the refineries and Gulf oil output is down 100 percent for nearly a week.''

Natural gas yesterday surged to a record on concern that a tropical storm system developing in the Caribbean Sea may develop into another hurricane that may cut production that has been crippled by two storms in the last month.

The so-called tropical wave, a weather system that develops off the coast of Africa during hurricane season, is near Jamaica and the Cayman Islands, hurricane center meteorologist Robbie Berg said. The system is the ``seedlings of what becomes a hurricane,'' he said.

The system may intensify into Tropical Storm Stan, which would become the 18th named storm of the 2005 Atlantic hurricane season.

Natural Gas

Natural gas for November delivery yesterday jumped 98 cents, or 7.5 percent, to $14.10 per million British thermal units and was at $14.04 in after-hours trading at 7:03 a.m. Singapore time. The October contract, which expired at the close, rose $1.251, or 9.9 percent, to $13.907, the highest close for a front-month contract since trading began in 1990. Futures reached $14.80, an intraday record. Prices have more than doubled in the past year.

Gas and oil prices often move in tandem because as many as 10 percent of U.S. factories and power plants can switch between burning oil and gas depending on cost.

U.S. crude-oil output in the Gulf has been halted for five days, the Minerals Management Service, which manages offshore resources, said yesterday. The region usually produces 1.5 million barrels a day. Natural gas production in the region is down 80 percent.

``We will have to wait till next week to get an idea of what the effects of Rita were,'' said Jason Schenker, an economist at Wachovia Corp. in Charlotte. ``This week's report doesn't reflect the 100 percent of offshore production that's been down.''

Oil Inventories

Crude oil supplies fell 2.4 million barrels to 305.7 million, the report showed. It was the fifth straight fall in stockpiles. Analysts expected a 1.75 million barrel decline, the Bloomberg survey showed.

Seven refineries in Port Arthur and Beaumont, Texas, and Lake Charles, Louisiana, close to where Rita made landfall on Sept. 24, are shut. Four plants that were damaged last month by Katrina are also shut.

Seven of nine refineries in the Houston area, to the west of Beaumont, have resumed operating after being spared major damage.

The shutdown of a Total SA refinery in Normandy, France, by a labor dispute has also helped drive gasoline prices higher, Commonwealth's Thurtell said.

``There are worries that the strike could spread to all of Total's operations in France, and France is a fairly major supplier of gasoline to the U.S.,'' he said.

U.S. stockpiles of distillate fuel, a category that includes heating oil and diesel, last week fell 573,000 barrels to 133.6 million.

Heating oil for October delivery yesterday rose 7.25 cents, or 3.5 percent, to $2.1411 a gallon, the highest close since Sept. 1. Futures, which yesterday touched $2.16, the highest intraday price since Sept. 2, were at $2.1325 in after-hours trading. Heating oil is 55 percent higher than a year ago.

To contact the reporter on this story: Angela Macdonald-Smith in Sydney at amacdonaldsm@bloomberg.net

Last Updated: September 28, 2005 19:45 EDT