OIL

When the nation's average price of regular gasoline reached a record high in September 2005, the cause was pretty clear: Hurricane Katrina had just ravaged oil refineries. But explaining this week's record of $3.22 per gallon is more complicated because the rise resulted from a combination of factors. They include increased demand, lower inventory, refinery shutdowns in the United States and abroad, and the rising price of crude oil, which has gone from about $50 per barrel at the start of the year to $64.97 per barrel yesterday.

Recessions are not inevitable adjustments built into the clockwork of a modern economy. Businesses no longer make products on long lead times and stumble into excess inventories of cars and appliances, triggering layoffs and pauses in consumer spending. Computer-aided supply-chain management and tracking of customer purchases allow businesses to better align what they make to what can be sold. However, recessions still happen, because of external shocks - natural disasters and political events - as well as errors of judgment and greed.

GASOLINE prices were too good to be true and have gone up. Expect another 8 to 15 cent-a-gallon increase at the pump before summer vacation but not the higher prices of two years ago.Oil prices sank because the Asian recession reduced demand, and producer countries that regulate supply were cheating to boost national revenues to meet government deficits. Regimes at war or subverting each other could not cooperate. Two attempts by the Organization of Petroleum Exporting Countries (OPEC) to limit production failed last year.

AVERAGE U.S. gasoline prices pushed above $1 a gallon last week for the first time since late last year, according to a government survey. One reason: The Organization of the Petroleum Exporting Countries reached an agreement to cut production of crude oil in an effort to prop up its price. OPEC and four non-OPEC countries have promised to reduce output by 2.1 million barrels a day.Crude prices fell to around $10 a barrel last year, as the Asian economic slowdown created an oil glut. Lately, though, they've risen above $15 a barrel for May delivery on the assumption that OPEC's deal will work.

LONDON -- BP Amoco PLC's board approved a plan yesterday to buy Atlantic Richfield Co., the eighth-largest U.S. oil company, for as much as $28 billion, a person familiar with the situation said.Arco's board is meeting today to consider the offer. Analysts expect the transaction to value Arco's shares at $75 or more each. That is about a 20 percent premium to their price last week, before the companies said they were in talks.The combination would create the largest oil producer and refiner in the United States.

Albert Ellsworth Makoski, a retired oil company executive, died May 19 of prostate cancer at William Hill Manor in Easton. He was 94.Mr. Makoski joined the Standard Oil Co. refinery in Canton in 1919 and later was promoted to petroleum laboratory chemist and employee relations manager at the Southeast Baltimore refinery. In 1961, was transferred to Exxon Oil Co.'s headquarters in Houston as senior manufacturing adviser and retired in 1969.A resident of St. Michaels since 1989, he was born in East Baltimore and graduated from City College.

There are some 50,000 dual nationals of Israel and the United States, and Samuel Sheinbein was never one.Linda Tripp's lawyer cannot be asked his dealings with her in Merlin, a protection the president himself lacked.John King is the nation's most cogent argument for retaining capital punishment.Psst, buddy, wanna buy an oil company, at today's oil prices?Pub Date: 3/01/99

LONDON -- BP Amoco PLC, the world's third-largest publicly traded oil company, said yesterday that it is negotiating to buy Atlantic Richfield Co. BP Amoco may pay as much as $25 billion in stock, a person familiar with the talks said.An announcement may come this week after the boards meet, the source said. BP Amoco and Arco jointly confirmed that negotiations are under way.The oil industry has been consolidating as it struggles with oil prices that fell by a third last year. A combined BP Amoco and Arco, the No. 8 U.S. oil company, could slash costs to blunt declining production at Alaska's Prudhoe Bay, the largest North American oil field.

DALLAS -- Exxon Corp.'s plan to create the largest publicly traded oil company with an $88 billion buyout of Mobil Corp. was overwhelmingly approved yesterday by both companies' shareholders.Exxon said 99.2 percent of shares voted by its shareholders were cast in favor of the merger. Mobil said 98.3 percent of its shares voted were cast for the buyout. The companies held separate shareholder meetings yesterday at hotels in Dallas, near Exxon's headquarters in Irving, Texas.The two companies announced the buyout Dec. 1 as oil prices were at historic lows and industry profits were plunging.

IKORODU, Nigeria -- For the fourth and final time, Kehind Adewole will wait in the tropical sun tomorrow to vote an end to military rule, joining millions of his countrymen in an act they hope will save this most populous African nation.The transition from army dictatorship to civilian democracy here has been a carefully paced process, and Adewole has participated in each step.First, the civil servant and father of three went to the polling station on the veranda of an ornate but dowdy green house at Ogunsanya and Alison streets to elect a local council for this down-at-its-heels township Dec. 5.On Jan. 9, he was back to elect a provincial governor.

OPEC adjourns without cutting production CAIRO, Egypt: OPEC held off on announcing new oil output cuts yesterday, but its alarm over falling demand and a slumping economy potentially laid the groundwork for a big reduction when it meets again in a matter of weeks. Chakib Khelil, Algeria's oil minister and the group's president, said the Organization of Petroleum Exporting Countries ministers noted "with concern the continued deterioration of the global economic situation and its impact on oil demand."

WASHINGTON - Charts at the ready, notes spread out before him, Rep. Roscoe G. Bartlett begins another address in the House of Representatives on the dangers of America's dependence on oil. The Western Maryland Republican has given nearly 50 such speeches at the Capitol in the past three years, most of them variations on a theme: that a coming decline in petroleum production, coupled with growing demand for energy, will have a calamitous impact on the...

House Speaker Nancy Pelosi's proposal to include expanded offshore drilling in a Democratic energy bill has nothing to do with reducing the cost of gas and everything to do with increasing votes for Democrats in November. Voters should listen carefully to what candidates are saying about energy policy between now and Election Day and favor those pushing aggressive efforts to develop alternative energy resources and conservation - two keys to a brighter energy future. Continued reliance on oil is not a long-term solution.

What do you know about Marcellus shale, a sedimentary bedrock that underlies much of the Appalachian Basin, including Maryland's westernmost counties, and why should you care? I didn't know anything about the black shale that was deposited about 400 million years ago during the Devonian period until the other day, when I was talking with a few Maryland geologists. In an 1839 report, Marcellus Shales in Seneca County, James Hall of the New York State Geological Society named the shale after an outcropping of it was discovered near Marcellus, N.Y. The reason Marcellus shale is important in this energy-conscious age is that it may well harbor about 500 trillion cubic feet of untapped natural gas, according to Terry Englander, a geoscience professor at Pennsylvania State University, and Gary Lash, a geology professor at the State University of New York at Fredonia.

WASHINGTON -- Jittery about a political backlash over gasoline costs as prices set yet another record yesterday, Congress voted to halt deliveries to the Strategic Petroleum Reserve in defiance of President Bush. The action was expected to have a modest impact on pump prices, saving motorists an estimated 2 cents to 5 cents a gallon, backers said. But its overwhelming support, including from Bush's usual GOP allies, underscored the potency of fuel costs as a campaign issue this year. The measure is likely to be one of the few Congress approves this year in response to public angst at the pump as Democrats and Republicans agreed on little else yesterday to bring down prices.

Recessions are not inevitable adjustments built into the clockwork of a modern economy. Businesses no longer make products on long lead times and stumble into excess inventories of cars and appliances, triggering layoffs and pauses in consumer spending. Computer-aided supply-chain management and tracking of customer purchases allow businesses to better align what they make to what can be sold. However, recessions still happen, because of external shocks - natural disasters and political events - as well as errors of judgment and greed.

CHICAGO -- Ethanol, the centerpiece of President Bush's plan to wean the U.S. from oil, is 2007's worst energy investment. The corn-based fuel tumbled 57 percent from last year's record of $4.33 a gallon and drove crop prices to a 10-year high. Production in the United States tripled after Morgan Stanley, hedge fund firm D.E. Shaw & Co. and venture capitalist Vinod Khosla helped finance a building boom. Even worse for investors and the Bush administration, energy experts contend ethanol isn't reducing oil demand.

Bright chill October days of sweet dry smells, smoke and apples and pigskin, memories of touch football games on grassy fields strewn with dry leaves. "You go deep," our QB said, thinking that a big, lanky kid like me must be a good receiver, so I galloped deep looking back over my shoulder, but I was not, in fact, all that terribly interested in actually fighting for possession of the ball. I was brought up to share, not to snatch things away from other people. Aggressiveness was not a prime value in my family.

Allegations that the Bush administration was driven to invade Iraq by a lust for the country's oil have been part of the anti-war movement's narrative since even before the war's first shots were fired. The image of a White House hijacked by a cabal of former oil executives who steer foreign policy to advance Big Oil's interests gained credence as disillusionment from the war grew. This idea is now being reinforced by former Federal Reserve Chairman Alan Greenspan, whose memoir hit bookstore shelves this month.

ATLANTA -- Should the United States invade a foreign country for its oil? If that question were posed in a poll, the vast majority of Americans would no doubt answer "no." We're the good guys in the world, spreading democracy, freeing the oppressed, opposing tyrants. We wouldn't invade a sovereign country strictly out of a selfish lust for its resources, would we? Of course we would. We've already supported coups, sent armies and invaded at least one country to protect our access to petroleum.