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Oil back above $103 ahead on supply drop

Benchmark crude for July delivery rose 86 cents to close at $103.58 a barrel in New York.

The Associated Press

5/29/2014

The price of oil rose above $103 barrel Thursday on a drop in supplies at the main U.S. oil trading hub and signs of growing gasoline demand in the U.S.

Benchmark crude for July delivery rose 86 cents to close at $103.58 a barrel in New York. On Wednesday, the Nymex contract dropped $1.39 to close at $102.72.

Brent crude, a benchmark for international oil used by many U.S. refineries, rose 16 cents to close at $109.97 a barrel in London.

The Energy Department said Thursday that supplies fell by 1.5 million barrels last week in Cushing, Oklahoma, where U.S. benchmark crude is priced, although overall U.S. inventories rose by 1.7 million barrels.

Gasoline supplies fell by 1.8 million barrels, suggesting demand for fuel is strong and refiners will need to buy more oil to keep up.

Internationally, prices were still supported by the crisis in eastern Ukraine, where pro-Russia rebels shot down a government military helicopter, killing 14 soldiers. Ukraine is a main transit route for Russian energy shipments to Europe.

In other energy futures trading in New York:

— Wholesale gasoline was rose 0.8 cent to close at $2.996 a gallon.

— Natural gas fell 5.6 cents to close at $4.559 per 1,000 cubic feet.

— Heating oil fell a penny to close at $2.920 a gallon.

AP Writer Pablo Gorondi contributed to this report from Budapest.

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