Wednesday, March 26, 2008

Oil Rises on Smaller-Than-Forecast Supply Gain

Crude oil rose more than $3 a barrel in New York after a government report showed that supplies gained less than forecast as imports and refinery operation dropped.

Inventories climbed 88,000 barrels to 311.8 million barrels in the week ended March 21, according to the Energy Department. A 1.8 million barrel gain was expected, according to the median of 12 responses in a Bloomberg News survey. Imports dropped 6 percent to 8.9 million barrels, the lowest since March 2007.

Crude oil for May delivery rose $3.12, or 3.1 percent, to $104.34 a barrel at 10:44 a.m. on the New York Mercantile Exchange. Futures prices climbed to $111.80 a barrel on March 17, the highest since trading began in 1983. Oil is up 66 percent from a year ago.

Brent crude for May settlement rose $2.51, or 2.5 percent, to $103.11 a barrel on London's ICE Futures Europe exchange. Futures reached a record $107.97 a barrel on March 17.
Refineries operated at 82.2 percent of their capacity, down 1.7 percentage points from the week before and the lowest since October 2005, the report showed.

The Energy Department released its weekly report on inventories at 10:30 a.m. in Washington.

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