High home heating-oil prices in December have prompted both state and local representatives to take action on lowering average monthly bills.

State Sen. Clarence Bell, R-Delaware, chairman of the Senate Consumer Protection and Licensure Committee, said prices for fuel oil rose about 50 percent during December 1989. Those hardest hit by the increase were senior citizens on fixed incomes and young working families with large numbers of children he explained.

"The profiteering of the big oil companies victimized not only the people of Pennsylvania but all the Northeastern United States," Bell said.

Investigations are being conducted to look into the price hike by the federal Department of Energy and the Public Protection Division of Pennsylvania's attorney general's office.

Rick Kane, general manager of ABC Oil in State College, said although prices went up, his company did not see additional profits. ABC was selling its oil at $1.25 per gallon on Jan. 1 as compared to 84 cents on Dec. 1.

"As prices increased our profit margin decreased," Kane explained. "All the profit taking occurred at the top. The retailers got nothing. It's just an unfortunate thing because the industry's image has become bad enough with all of the recent oil spills."

Kane said his company received many complaints during December and business was hectic.

"We were delivering to about 150 homes a day. Compared with past winters, that's a very high number," Kane said.

Tom Martin, chairman of Martin Oil, did not see the recent price hikes as the result of increased profit taking. Nittany Oil is a subsidiary of Martin Oil.

"December was an abnormally cold month and demand was high," Martin said. "Companies had to raise their prices to reach that demand. It's enterprise. The market will not allow you to extract any more than the law of supply and demand warrants."

Martin pointed out that prices dropped in January as a result of warmer weather.

According to state Attorney General Ernest Preate Jr.'s testimony before the state Senate Consumer Protection and Professional Licensure Committee, the shortage of reserves that the oil companies blamed for the price increase were artificial.

"The oil industry intentionally entered the winter with low inventories," Preate said.

At the beginning of the heating season, the inventory of U.S. heating oil supplies was at its lowest level in 15 years. In October, when the inventory was taken, 119 million barrels were in stock, according to Preate's testimony. In October 1973, during the height of the Arab oil embargo, the industry's inventory was just over 200 million barrels.

"When commodities speculators saw the combination of comparatively tight supplies and a colder than usual December, they recognized a golden opportunity to make huge profits by gambling in the futures markets," Preate said. "Wild speculation drove prices for heating oil futures from 58 cents per gallon in mid-November to $1.02 per gallon on the morning of Dec. 28."

Such a frenzy in the futures market drove oil prices up and out of proportion to the supply and demand forces of the market, he said.

Preate also asked the Pennsylvania Legislature to give his office the power to obtain company data for antitrust investigations before filing any suits. Pennsylvania is the only state in the nation that does not have its own antitrust law of general application.

On the federal level, results from the Department of Energy's investigation will not be available until June. In the Senate, proposed legislation would make it a federal crime to create a fuel shortage. The bill, modeled after a Connecticut law, will not be up for discussion until early fall.

Bell said he believes this is too much of a delay.

"Strong action by the federal government is necessitated and does not seem to be taking place," Bell said.

State College residents having difficulty paying oil bills should contact the Low Income Home Energy Assistance Program at 355-6000. Residents who qualify for LIHEAP can receive $250 and up to $300 in fuel assistance for the season.