Energy costs soar with Iraq threat

WASHINGTON, D.C. -- Prices for heating oil and gasoline are soaring and likely to keep rising as energy markets cope with a colder than expected winter, the loss of Venezuela's production and worries about war with Iraq.\nA deep freeze in the Northeast caused heating oil prices to spike by 20 percent last week. The Energy Department, citing low stocks -- as well as higher natural gas prices -- said heating bills could be 50 percent higher this year than last winter.\nConsumers are getting hit at the gasoline pumps as well.\nNationally, gasoline prices increased for the ninth straight week to an average of $1.61 a gallon for regular grades, 51 cents a gallon higher than a year ago, according to the federal Energy Information Administration. Many parts of the country have seen price hikes of 20 cents a gallon in recent weeks.\nCrude oil moved above $35 a barrel Friday, the highest it has been in two years. Government analysts forecast that prices probably will stay above $30 a barrel this year, even if a war is avoided in Iraq.\nThe price of light sweet crude was $34.78 per barrel at noon Monday on the New York Mercantile Exchange.\nAlthough OPEC oil producers have boosted production, they have yet to make up the oil lost to political unrest in Venezuela. Crude inventories fell "well below the low end of the normal range" at the end of January, said the Energy Department. With high crude prices and some shortages, refiners scaled back operations, choosing to perform normal maintenance a few weeks early, some analysts said"