Oil futures rise with steep decline in inventories
NEW YORK — Oil futures rose yesterday after the government reported larger-than-expected declines in crude and heating oil inventories.
The Energy Department's Energy Information Administration said oil inventories fell by 3.3 million barrels last week, more than double the 1.3 million-barrel decline analysts expected. Inventories of distillates, which include heating oil and diesel fuel, fell by 2.8 million barrels, much more than the expected drop of 800,000 barrels.
Crude and heating oil supplies have declined more than expected for several weeks running, exacerbating a perception that supplies may be inadequate to meet winter demand.
Oil prices also rose on news of the assassination of Pakistani opposition leader Benazir Bhutto and a vow by opposition politician Nawaz Sharif to boycott parliamentary elections next month, which raised concerns about geopolitical stability. Sharif also demanded that President Pervez Musharraf resign immediately.
Earlier in the week, oil prices rose when attacks by Turkish forces on Kurdish rebels in northern Iraq raised concerns about Iraqi oil supplies.
UNITED CANCELS 168 MORE FLIGHTS
DENVER — United Airlines, hit hard by weekend storms in the Midwest, canceled dozens more flights yesterday as the second storm since Christmas threatened to pile 20 inches of new snow on Colorado.
Up to 8 inches of new snow was expected in Denver, which set a record for its snowiest Christmas with the nearly 8 inches that fell Tuesday.
United canceled 168 flights nationwide yesterday mostly because of the weather in Denver, its second-largest hub, to help prevent planes from being stranded there. That's about 5 percent of the airline's daily schedule.
It marked the fourth straight day that United had canceled flights. The Chicago-based carrier grounded 121 flights Wednesday as it moved crews to deal with schedules disrupted days earlier when bad weather hit O'Hare International Airport. A United spokeswoman said the airline had recovered from those delays before the storm moved into Colorado.
INSURANCE PAYOUT DOUBLES THIS YEAR
BERLIN — Losses to insurers from natural disasters nearly doubled this year to just below $30 billion globally after an unusually quiet 2006, a leading reinsurer said yesterday, from winter storms in Europe, flooding in Britain and wildfires in the U.S.
Munich Re warned that climate change could mean a growing number of weather-related catastrophes in coming years.
While losses soared in 2007, the figure was far short of the $99 billion Munich Re recorded in 2005 — when Hurricane Katrina slammed into New Orleans.
The world's second-largest reinsurer put total economic losses this year — which include losses not covered by insurance — from natural disasters at $75 billion — a 50 percent increase from last year's $50 billion, but below $220 billion in 2005.
SALLIE MAE STOCK SALE RAISES DOUBTS
WASHINGTON — Sallie Mae's planned $2.5 billion stock sale doesn't answer all of Wall Street's questions about the struggling student lender's future.
While some analysts see the company's financing woes as a short-term problem, others highlight serious concerns about the Reston, Va., company, such as soaring loan defaults and a potential cut in its credit ratings.
Sallie Mae, formally known as SLM Corp., earlier this month lowered its earnings forecast for next year by more than 13 percent, blaming a new law that trims federal subsidies and the need to conserve cash to offset bad student loans. Then, CEO Albert Lord held a contentious conference call last week in which he dismissed several analysts' questions and ended the call with an expletive.
These developments only compounded pressure on the company's stock price, which has fallen steadily since July, when a group of investors who eventually backed out of buying Sallie Mae for $25 billion first indicated the deal could be in trouble.
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