Crude tops $111 after supply report

Bloomberg News
Wednesday, April 9, 2008

NEW YORK: Crude oil rose above $111 a barrel in New York and gasoline surged to a record after a government report showed that U.S. supplies unexpectedly dropped.
Crude oil inventories fell 3.15 million barrels to 316 million last week, the first decline since February, the Energy Department said. A 2.3-million-barrel gain was forecast, according to a Bloomberg News survey. Supplies of gasoline and distillate fuel, including heating oil and diesel, also fell.

"The crude stock draw was obviously the big surprise and leaves supplies too tight for comfort," said Antoine Halff, head of energy research at New York-based Newedge USA. "Refineries are operating at a very low rate and we still didn't get an inventory gain."

Crude oil for May delivery rose $2.71, or 2.5 percent, to $111.21 a barrel in late morning trading on the New York Mercantile Exchange. Prices are up 81 percent from a year ago. Futures prices rose to a record $111.80 a barrel on March 17.

Gasoline for May delivery climbed 5.8 cents, or 2.1 percent, to $2.8084 a gallon. Futures reached $2.8228, an intraday record for gasoline to be blended with ethanol, known as RBOB, which began trading in October 2005.

U.S. pump prices are following futures higher. Regular gasoline, averaged nationwide, rose 1.2 cents to a record $3.343 a gallon, AAA, the largest U.S. motorist organization, said Wednesday on its Web site ... Read the Entire Article