Mar. 14--The price of Kern River crude, the county's benchmark oil, continued its dramatic climb when it jumped another 50 cents Wednesday to $16.25 a barrel.
The last time Kern River crude commanded such a price was in late June 1992.
Chevron increased its price Wednesday in reaction to overall market forces, said Chevron spokesman Mike Marcy.
The price on the New York Mercantile Exchange for light, sweet crude rose again Wednesday to $20.58 a barrel. The last time Kern prices jumped March 6, the Merc closed at $20.19 a barrel.
"There is a continuing disparity between refiners' anticipation of cheaper crude and geo-political realities," Marcy said. "The refinery folks have continued to keep their inventories very short, betting cheaper crude is right around the corner and in the meantime, we've had continued strong product demands and cold weather."
Similar pressures were behind a string of price increases starting last month. This is the fifth straight increase since Feb. 13.
The only other oil companies to change their prices as of Wednesday evening were Texaco and Koch Oil. Texaco was offering $16 for a barrel of 13-degree gravity oil and Koch's price was $15.75.
Mobil, EOTT Energy/Enron and Unocal hadn't changed and were offering $15.75, $15.50 and $15.25, respectively.
Independent heavy oil producer Don Macpherson Jr. called Chevron's price increase "great."
"I don't know how long it's going to be around, but it's nice while it's here, and we ought to enjoy it," he said. "Will people drill new wells because of this increase? Maybe. Will people turn on more wells that were uneconomical at a lower price? Absolutely."
Crude oil wasn't the only fuel to enjoy a price increase on the Merc Wednesday.
Natural gas futures prices surged as investors bet new inventory figures would show a continued drawdown in stocks.
Natural gas for April delivery rose 7.2 cents to $2.240 per 1,000 cubic feet after breaking through technical resistance early in the session at $2.235.
The move higher in natural gas illustrates the continued tight world stocks situation, even as the winter heating season comes to a close, analysts said.
"This move is basically attributed to the low storage levels," said Frank F. Zerilli, an energy analyst with E.D.F. & Man International Futures Inc. in New York.
Traders expected the American Gas Association to report after the close that supplies are running about 40 percent below year-ago levels, Zerilli said. The AGA later reported that stocks dropped 118 billion cubic feet from the week earlier, about 38 percent lower than year-ago levels.
Last week's data showed supplies about 36 percent below year-ago levels, in part because of the unusually cold weather in North America and Europe.
Tim Evans, an analyst for Pegasus Econometric Group in New York, said the market has its eyes on the calendar because natural gas inventories usually reach their lowest point for the year in mid-April before being replenished again for the fall.
The Associated Press contributed to this report.
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