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Oil jumps above $94 on U.S. supply report

Oil supplies fell by 1 million barrels, or 0.3 percent, to 360.3 million barrels last week. Analysts expected an increase of 2.5 million barrels. The drop was due mainly to a decline in imports.

The Associated Press

1/16/2013

NEW YORK — The price of oil jumped above $94 a barrel Wednesday after an unexpected drop in U.S. crude supplies.

Benchmark oil was up 92 cents to $94.20 a barrel at midday on the New York Mercantile Exchange.

Oil supplies fell by 1 million barrels, or 0.3 percent, to 360.3 million barrels last week. Analysts expected an increase of 2.5 million barrels. The drop was due mainly to a decline in imports. Gasoline supplies grew less than expected as refineries slowed output.

Still, supplies of oil and gasoline remain above average for this time of year, with crude inventories nearly 9 percent higher than a year ago and gasoline levels more than 3 percent higher. U.S. production of crude, at more than 7 million barrels a day, is the highest in 20 years.

Going forward, trading will be watching for the latest reading on China's economic growth Friday and contentious negotiations in Washington over the nation's borrowing limit.

Brent crude, used to price international varieties of oil, was up 37 cents to $110 per barrel on the ICE Futures exchange in London.

In other energy futures trading on Nymex:

— Wholesale gasoline rose 2 cents to $2.73 a gallon.

— Natural gas lost 7 cents to $3.38 per 1,000 cubic feet.

— Heating oil was flat at $3.01 a gallon.

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