July 6 (Bloomberg) -- Crude oil surged to a record $61.35 a barrel in New York on speculation that Tropical Storm Dennis may disrupt shipments along the U.S. Gulf coast. Gasoline and heating oil also rose to records as refineries shut.

Dennis may strengthen to a hurricane today, becoming the earliest ever to form in the Atlantic, the U.S. National Hurricane Center said. The storm may enter the Gulf in three days. Oil output and refinery operations in the region were cut because of Tropical Storm Cindy, which made landfall overnight. The Louisiana Offshore Oil Port shut yesterday because of Cindy.

``Dennis is moving toward the Gulf and nobody wants to take a chance,'' said Tom Bentz, an oil broker at BNP Paribas Commodity Futures Inc. in New York. ``Prices had already hit records on concern about demand in the third and fourth quarters and OPEC capacity limits. The arrival of hurricanes that can cause refinery outages, close platforms and the Loop were the last thing we needed.''

Crude oil for August delivery rose $1.51, or 2.5 percent, to $61.10 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Futures touched $61.35 a barrel, the highest since trading began in 1983. Prices are up 54 percent from a year ago.

Heating oil for August delivery surged 6.26 cents, or 3.6 percent, to $1.795 a gallon in New York. Prices touched $1.798 a gallon, the highest since the contract was introduced in 1978. Heating-oil futures are 64 percent higher than a year ago.

Gasoline for August delivery rose 10.82 cents, or 6.4 percent, to $1.79 a gallon. Prices touched $1.7935, the highest since the contract was introduced in 1984.

Retail Gasoline Prices

``Retail prices lag the futures contract,'' said Jason Schenker, an economist at Wachovia Corp. in Charlotte. ``If we continue to see futures at record levels, retail prices should follow.''

Pump prices for regular-grade gasoline fell 0.1 cent to an average $2.222 a gallon yesterday, according to the AAA. Prices touched a record $2.276 a gallon on April 11 and are 18 percent higher than a year ago.

Murphy Oil Corp. said it was starting its Meraux refinery today. A company spokeswoman couldn't say what time the outage happened at the 125,000 barrel-a-day facility or how long it was shut. Meraux is outside New Orleans.

Shut Refinery Units

Motiva Enterprises LLC, a joint venture between Royal Dutch/Shell Group and Saudi Aramco, said it was evaluating returning its Norco refinery to normal operations after closing last night because of a power outage. The refinery can process 240,000 barrels of crude oil a day and is located 20 miles north of New Orleans.

Valero Energy Corp. said it cut operations at two refineries after power failures. The disruptions to power service lowered production at the company's St. Charles refinery by 25,000 barrels a day, according to an e-mailed statement from company spokeswoman Mary Rose Brown. Output at the refinery in Krotz Springs was lowered by 15,000 barrels a day, Brown said.

The Loop, the biggest U.S. oil import terminal, stopped unloading cargoes from tankers yesterday because of the storm. The port may resume operations today, a port official said.

States along the Gulf coast receive more than half of U.S. oil imports and are home to 50 percent of the nation's refining capacity. The region also is the source of 30 percent of U.S. oil production, according to the Minerals Management Service.

``Dennis looks like it will be much stronger and could lock down platforms in the Gulf,'' said Aaron Kildow, a broker at Prudential Financial Derivatives LLC in New York. ``It's only the first week of July and we've had four named storms, which is an awful lot.''

Tropical Storms Arlene and Bret formed in June. Arlene made landfall near Pensacola, Florida, on June 11. Oil and natural- gas production was reduced because companies evacuated platforms in the Gulf. Bret made landfall in Mexico on June 29.

Hurricane Ivan

Hurricane Ivan in September damaged production platforms and pipelines in the Gulf. Ivan cut 43.8 million barrels of oil production and 172.3 billion cubic feet of natural-gas output, according to the MMS in June. The Atlantic hurricane season lasts from June through November.

Oil surged to a record last week on concern fuel supplies would be insufficient to meet demand. Output by members of the Organization of Petroleum Exporting Countries rose an average of 130,000 barrels a day in June, a Bloomberg survey showed. The increase left the producer group with little spare oil production capacity.

Crude-Oil Inventories

U.S. crude-oil supplies probably fell 1.63 million barrels in the week ended July 1 from 328.5 million the previous week, according to the median of forecasts by 16 analysts before an Energy Department report tomorrow. Distillate fuel inventories probably rose 1.5 million barrels. Analysts were split on whether gasoline supplies rose or fell last week.

In London, the August Brent crude-oil futures contract rose $1.59, or 2.7 percent, to $59.88 a barrel on the International Petroleum Exchange. Brent touched $60 a barrel, the highest since the contract was introduced in 1988.

To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net.

Last Updated: July 6, 2005 14:53 EDT