The D.C. government's chief purchasing agency recommended yesterday that a one-year, $17.8 million fuel oil supply contract be awarded to Tri-Continental Industries Inc., the firm that has supplied the city's oil for three years.

William Johnson, director of the Department of Administrative Services, said his department chose Tri-Continental over Atlantic Petroleum Corp., the apparent low bidder for the bulk of the contract, because Atlantic failed to provide the necessary guarantees that it would supply the heating oil necessary and that it had adequate financial backing. Mayor Marion Barry is expected to make the final decision today, based on the department recommendation.

Atlantic Petroleum submitted a bid that was between $213,000 and $441,000 less than the one submitted by Tri-Continental, depending on when the city paid for the supply. However, Johnson said Atlantic Petroleum failed to meet the city's requirement that it obtain a $2 million line of credit at a financial institution and did not have the necessary agreements with various area terminals for storing the fuel.

The city's handling of the fuel contract touched off a controversy on Capitol Hill during the summer after reports that the city initially awarded the contract to Tri-Continental, a minority-controlled firm, in 1982 through competitive bidding but then negotiated extensions of the contract in subsequent years.

The extensions angered other oil firms, which complained to the Department of Administrative Services last fall.

The mayor contends that Tri-Continental was the only minority firm qualified to bid when the city extended the fuel oil contract. However, the owners of two other minority firms said the city had certified them as qualified to bid at the time.

Johnson said yesterday that Tri-Continental's latest bid was $900,000 lower than the estimated amount of last year's contract and that the city's Contract Review Committee had approved the department's recommendation.

Roslyn Hill, president of Atlantic Petroleum, said that the city did not give her firm's bid fair consideration. She said that District officials had previously told her that they would consider other types of financing besides a $2 million line of credit at a financial institution but then changed their minds last week. She also said her firm had provided ample assurances of uninterrupted supply and that her supplier has agreements with the terminals where the fuel would be stored.

The third bid, from Green Fuel Oil Inc., was too high, Johnson said.