Oil swung between gains and losses as deliveries resumed on the U.S. East Coast after Hurricane Sandy. Increases were capped before presidential elections in the U.S., the world’s biggest crude consumer. Futures were little changed after rising from an almost four-month low yesterday. Fifteen tankers, including two crude carriers, will arrive this week in New York Harbor, according to the U.S. Coast Guard. Phillips 66 said it will resume operations in two to three weeks at its Bayway refinery in New Jersey. U.S. voters decide today whether to return Barack Obama as president or elect his challenger Mitt Romney. “The market is holding its breath for the U.S. presidential election,� said Victor Shum, the managing director at IHS Consulting in Singapore. “Pricing appears to be supported at the current levels. The U.S. East Coast is recovering, refineries are starting back up, but I don’t expect any significant rise in oil futures because demand is still going to be on the low side.� West Texas Intermediate oil for December delivery was at $85.56 a barrel, down 10 cents, in electronic trading on the New York Mercantile Exchange at 3:36 p.m. Singapore time. The contract advanced 79 cents to $85.65 yesterday after closing last week at the lowest level since July 10. Prices have dropped 13 percent this year. Brent oil for December settlement was up 6 cents at $107.79 a barrel on the ICE Futures Europe exchange. The European benchmark crude was at a premium of $22.21 to New York-traded WTI after widening 6.1 percent yesterday. Forties Deferrals Brent’s spread to WTI has grown amid maintenance at the North Sea fields that underlie the Brent contract. Fifteen of 16 Forties oil cargoes were deferred in October and at least 60 percent of consignments in November were delayed. That’s an unprecedented number of disruptions, according to a survey of five traders yesterday, three of whom have been involved in this crude market for more than 10 years. Morgan Stanley increased its forecast for the Brent-WTI spread in the fourth quarter to about $20 a barrel from $17.50 previously because of the disruptions. The premium will average about $19 in November and December, the bank said in an e-mailed report dated today. Nexen Inc. (NXY) confirmed yesterday that it restarted the 200,000 barrel-a-day North Sea Buzzard oil field, the biggest contributor to Forties blend, after a two-month maintenance. New York Five of the 15 ships scheduled to arrive in New York Harbor are carrying naphtha, three are transporting gasoline, two hold crude, and one is carrying fuel oil, Charles Rowe, a spokesman for the U.S. Coast Guard in Staten Island, New York, said in a telephone interview yesterday. Colonial Pipeline Co. began deliveries from its Linden, New Jersey, fuel tank farm to customers with operable terminals and is working with facilities that haven’t reopened to ensure service is restarted promptly, according to Steve Baker, a company spokesman. Phillips 66 plans to resume operations at the 238,000 barrel-a-day Bayway plant, the largest single refinery on the U.S. East Coast, after repairing the electrical equipment that was primarily damaged by Sandy, the Houston-based company said on its website. Process units are “in good condition,� it said. The refinery was one of seven plants with a total capacity of 1.29 million barrels a day that halted production or cut rates because of Sandy. U.S. fuel inventories probably fell last week after the storm shut the refineries and terminals, according to the median of nine analyst estimates in a Bloomberg survey before an Energy Department report this week. Gasoline Stockpiles Stockpiles of gasoline decreased by 1.5 million barrels to 198 million in the seven days ended Nov. 2, according to the median of nine analyst estimates. Supplies of distillate fuel, a category that includes diesel and heating oil, probably declined 1.25 million barrels to 116.7 million. A decrease of that size would leave inventories at the lowest level since June 2008. Gasoline on the New York Mercantile Exchange has fallen 10 percent since climbing as high as $2.9375 a gallon on Oct. 31, two days after Sandy made landfall. December futures were at $2.6309 today, up 1.07 cents. The national average cost of regular, unleaded gasoline at the pump declined 7.6 cents to $3.492 a gallon yesterday from a week earlier, the U.S. Energy Information Administration said in a report on its website. The price was $3.424 a year earlier. Rising costs for the motor fuel were used by Romney as a weapon in the Republican’s campaign to unseat Democratic President Obama in today’s election. Oil in New York has technical support along its lower Bollinger Band around $83.76 a barrel today, according to data compiled by Bloomberg. Futures rebounded after reaching this indicator the past two days, signaling buy orders may be clustered close to it. To contact the reporter on this story: Ramsey Al-Rikabi in Singapore at ralrikabi@bloomberg.net To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

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