U.S. releases more diesel to ease fuel shortages after Sandy

WASHINGTON Fri Nov 9, 2012 9:10pm EST

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WASHINGTON (Reuters) - The U.S. Energy Department on Friday said it would release an additional 100,000 barrels of diesel from the nation's emergency heating oil reserves to help ease fuel shortages in Connecticut due to Hurricane Sandy.

The release from the emergency stockpile comes as the U.S. Northeast continues to grapple with severe fuel supply disruptions after a massive storm swept through the region last week.

"This loan from the Northeast Home Heating Oil Reserve will help ensure communities in the impacted area have access to the diesel fuel they need for their transportation systems," Energy Secretary Steven Chu said in a statement.

The department will begin releasing fuel to the Defense Department as early as this weekend to provide emergency loans to fuel distributors in Connecticut.

Distributors receiving the ultra-low sulfur diesel through the emergency release, representing about five days of fuel consumption in Connecticut, will have to repay the loans in the next 30 days.

This is the latest fuel release from the department, which said last week it would loan about 48,000 barrels of diesel to help local and federal responders in New York and New Jersey.

Created in 2000, the Northeast Heating Oil Reserve holds about a million barrels of diesel.

(Reporting by Ayesha Rascoe; Editing by Gary Hill and Lisa Shumaker)

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