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Heating Oil, Gasoline Slide as Exxon Refinery Strike Averted

Nov. 18 (Bloomberg) -- Heating oil fell and gasoline slid to a nine-month low as workers at an Exxon Mobil Corp. refinery in Belgium postponed a strike and on concern that the Europe debt crisis may curb fuel demand.

Futures sank as Exxon delayed shutting its Antwerp refinery after labor unions suspended strike plans “until an Exxon proposal has been put up for referendum,” Johan Scharpe, a company spokesman based in Antwerp, said by phone today. Pacific Investment Management Co.’s Bill Gross, manager of the world’s largest mutual fund, said Europe poses the biggest risk to the U.S. economy.

“Shutting that refinery could have been bullish for products,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.

December-delivery heating oil fell 5.07 cents, or 1.6 percent, to settle at $3.0325 a gallon a gallon on the New York Mercantile Exchange, the lowest settlement since Nov. 2. Prices declined 4.4 percent this week, the first loss in three weeks and the largest drop since September.

In Europe, German Chancellor Angela Merkel yesterday rejected French calls to deploy the European Central Bank as a crisis backstop. The ECB bought Italian and Spanish bonds to stem the region’s debt crisis.

“Unless they come out and say they’re going to buy an infinite number of bonds, the problems in Europe are worse than they ever were,” said Ray Carbone, president of Paramount Options Inc. in New York.

Faster Growth

Heating oil rose as high as $3.1284 today as analysts increased U.S. growth outlooks for the fourth quarter and a report signaled the world’s largest economy will continue to grow in 2012.

Economists at JPMorgan Chase & Co. now see the U.S. GDP rising 3 percent in the fourth quarter, up from a previous prediction of 2.5 percent. Macroeconomic Advisers increased its forecast to 3.2 percent from 2.9 percent at the start of November, while Morgan Stanley & Co. boosted its outlook to 3.5 percent from 3 percent.

The Conference Board’s gauge of the outlook for the next three to six months rose 0.9 percent, the most since February, after a 0.1 percent September gain. The median forecast of 56 economists surveyed by Bloomberg News projected the gauge would advance 0.6 percent.

“Everything coming out the last few weeks about the U.S. is beating expectations,” said Dominick Chirichella, senior partner at the Energy Management Institute in New York. “The sentiment about Europe is still negative and the market is not comfortable with even a little progress there.”

Gasoline for December delivery fell 2.87 cents, or 1.1 percent, to settle at $2.4784 a gallon, the lowest since Feb. 11. Futures lost 4.8 percent this week. Prices have dropped 12 percent in five consecutive weeks of declines. The fuel’s discount to heating oil narrowed to 55.41 from 57.61 yesterday.

Regular gasoline at the pump, averaged nationwide, sank 0.9 cent to $3.384 a gallon yesterday, according to AAA data.

To contact the reporter on this story: Barbara J Powell in Dallas at

To contact the editor responsible for this story: Dan Stets at

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