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Oil prices edge higher on mixed reports

The Energy Department said inventories of crude oil rose by 4.2 million barrels last week. Analysts were expecting an increase of just 1 million barrels. The report indicated that demand for oil in the U.S. remains weak.

The Associated Press

2/29/2012

NEW YORK — Oil prices edged higher Wednesday as the government said the U.S. economy expanded at a 3-percent annual rate in the fourth quarter.

That's up from a prior estimate of growth of 2.8 percent. Americans also earned more income in the final three months of 2011 than previously reported.

Earlier in the day, oil fell on another report showing a bigger-than-expected increase in U.S. crude supplies. Prices recovered in the afternoon.

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West Texas Intermediate, which is used to price oil produced in the U.S., rose 52 cents, or 0.5 percent, to settle at $107.07 a barrel on the New York Mercantile Exchange. Traders said the late buying may also be tied to the continued standoff between the West and Iran over that country's nuclear program.

Brent crude, which is used to price international oil, gained 69 cents to $122.24 in London.

The Energy Department said inventories of crude oil rose by 4.2 million barrels last week. Analysts were expecting an increase of just 1 million barrels. The report indicated that demand for oil in the U.S. remains weak.

Meanwhile, retail gasoline prices rose for the 22nd consecutive day to a U.S. average of $3.73 per gallon. That's 30 cents higher than a month ago and 36 cents higher than the same time last year.

The Energy Department said gasoline supplies shrank by 1.6 million barrels, or 0.7 percent, to 229.9 million barrels. That's 2 percent less than year-ago levels. Analysts expected gasoline supplies to decrease by 180,000 barrels.

Demand for gasoline over the four weeks ended Feb. 24 was 6.7 percent lower than a year earlier, averaging 8.3 million barrels a day.

Gasoline futures on the Nymex rose 3.2 cents to $3.2572 a gallon. They're still down nearly 2 percent this week but are on track to finish February with a gain of 13 percent.

In other energy trading, natural gas futures rose 8.3 cents to $2.71 per 1,000 cubic feet. Heating oil fell by 1.4 cents to $3.206 a gallon.

Kevin Jones of The Trucker staff can be reached for comment at kevinj@thetrucker.com.

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