Inventories of US commercial crude oil and gasoline decreased in the week before Hurricane Katrina disrupted the nation's oil production along the Gulf of Mexico, the Energy Department reported Wednesday in its weekly petroleum survey.

Data released by the department showed that commercial crude oil inventories declined by 1.5 million barrels in the week ending Aug. 26 to 321.4 million, still well above the average for this time of year.

At the same time, gasoline stockpiles dropped by 500,000 barrels to 194.4 million, a very low level compared to the historical average. The drop followed an even sharper dive of 3.2 million barrels the week before.

However, the supply of distillate fuel, including diesel and heating oil, rose by 2.7 million barrels to 135.2 million last week.

A parallel survey by the private American Petroleum Institute found that commercial crude oil inventories increased by one million barrels last week to 322.67 million. Distillate fuel reserve also went up 4.4 million barrels while gasoline stocks dropped by 1.7 million barrels.

The figures for commercial crude oil inventories do not include oil held in the US Strategic Petroleum Reserve (SPR), which stood at 700.5 million barrels on Aug. 26.

Damage caused by Hurricane Katrina, one of the strongest storms ever to threaten the United States, could result in oil shortages in the medium term and slow down economic growth during the third quarter of this year, according to analysts.

The Bush administration, which has stressed that the SPR can only be used at a time when US oil supply was severely disrupted, would release oil from the reserve to help refineries whose operations had been badly hit by Katrina, Energy Secretary Samuel Bodman announced Wednesday.

Source: Xinhua