NOVELTY - Fuel stream comprising hydrogen, carbon monoxide, carbon dioxide and water in presence of oxygen containing stream is passed to preferential oxidation (PO) zone containing PO catalyst comprising ruthenium (Ru) metal dispersed on shaped alumina carrier (AC). Ratio of Ru content relative to average metal content (along band extending from surface to center of AC) is greater than 1 at surface of AC.    USE - For conversion of carbon monoxide contained in fuel stream to produce a hydrogen-rich fuel gas stream for use in fuel cell particularly polymer electrode membrane (PEM) for generation of electric power (claimed) in motor vehicles and batteries.    ADVANTAGE - The concentration of carbon monoxide in the prefox (preferential oxidation) effluent is reduced to less than 50 ppm-volume at preferential oxidation conditions. The active metal is dispersed on surface of catalyst carrier, and the catalyst is stable and active. The catalyst operates effectively at conditions which are more favorable for reducing carbon monoxide concentration in fuel gas of fuel cell system. The catalyst provides selective conversion of carbon monoxide and high selectivity for producing carbon dioxide without regeneration. The catalyst provides sustainable carbon monoxide conversion for equivalent amount of ruthenium than comparative ruthenium containing catalyst. As the content of carbon monoxide in the fuel gas is minimized, poisoning of the fuel cell membrane is prevented and the life of fuel cell membrane is increased.    DETAILED DESCRIPTION - The fuel stream is passed at oxidation conditions. PO zone produces a hydrogen-rich fuel gas stream for use in fuel cell for generation of electric power. The fuel stream is prepared by passing a feed stream comprising hydrocarbon or oxygenate to a fuel processor comprising an integrated reforming and water gas shifting conversion zone to produce fuel stream. The alumina carrier has apparent bulk density of 0.2-0.7, and ruthenium metal comprises 0.5-10 weight% of catalyst.    An INDEPENDENT CLAIM is also included for preferential oxidation catalyst preparation method.