Crude futures hit record high of $111.87 a barrel after inventory surprise
as it is its $4/gal for me now.
just keeping the public informed on the situation
Similarly, gains were seen in petroleum-products futures trading on the New York Mercantile Exchange.
The nation's stockpiles of crude fell to 316 million barrels in the week ended April 4, the Energy Information Administration reported.
This was down 3.2 million barrels on the week. Analysts surveyed by energy information provider Platts had been looking for an increase of 2.7 million barrels.
Crude oil for May delivery surged $3.71, or 3.4%, to a record of $112.21 a barrel in Nymex action in mid-afternoon trading. The benchmark contract had been up less than $1 before the data came out.
"The hefty fall in crude oil stockpiles was a major shock for a market which was expecting the opposite," said Martin Slaney, an analyst at Global Futures & Forex, in email comments. "As we head into driving season in the U.S. the tumbling inventories data is particularly significant."
Chris Lafakis, an analyst at Moody's Economy.com, called last week's reduction in inventories "supportive of record oil prices." Crude's previous all-time high record was $111.80 hit on March 17.
Also Wednesday on Nymex, May reformulated gasoline rose 5.83 cents to $2.8087 a gallon and May heating oil gained 7.7 cents to $3.1872 a gallon, while May natural gas futures rose 41.3 cents to $10.11 per million British thermal units. Weekly data on U.S. gas in storage are due out on Thursday.
Crude inventories in detail
The unexpected drop in crude inventories came from sliding imports, the government's data showed.
U.S. oil imports averaged 8.9 million barrels a day last week, down nearly 1.4 million barrels a day from the previous week, the EIA reported.
"While imports will probably rebound next week, oil prices will nonetheless go up in the interim," said Lafakis.
The EIA also reported crude inventories at Cushing, Okla., the delivery point for crude traded on the Nymex, were unchanged at 17.5 million barrels.
Meanwhile, U.S. gasoline supplies fell 3.4 million barrels in the latest week, while distillate supplies, which include heating oil and diesel, dropped 3.7 million barrels. Analysts surveyed by Platts had been anticipating declines of 2.3 million barrels for gasoline stocks and 1.3 million barrels for distillates.
U.S. refineries operated at 83% of their operable capacity last week, up from the previous week's 82.4%.
In a separate report, the American Petroleum Institute said U.S. crude inventories rose by 6 million barrels in the week ended April 4, reaching to 315.5 million barrels. The API, an association of the U.S. oil and natural gas industry, calculates inventories based on different criteria.
Distillate stocks fell to 112.8 million barrels, down 177,000 barrels, while gasoline stocks rose by 1.8 million barrels to stand at 219.2 million barrels, the API said.
Crude's new record came even when the EIA is forecasting lower energy demand in the U.S.
EIA said in a monthly report released on Tuesday that consumption of liquid fuels and other petroleum products is projected to grow by 40,000 barrels a day in 2008, a downward revision of 100,000 barrels a day from the previous monthly forecast.
After accounting for increased ethanol use, U.S. petroleum consumption actually could fall by 90,000 barrels a day.
EIA also forecast gasoline prices could surpass $4 a gallon in the upcoming driving season.
"There is a significant possibility that prices during some shorter time period, or in some region or sub-region, will cross the $4 per gallon threshold," EIA said in the monthly report.
West Texas Intermediate crude, or the underlying product of the Nymex crude futures, is expected to average $102 in March, EIA said in the report. The annual average WTI price, which was $72 per barrel in 2007, is projected to average $94 per barrel in 2008, but ease to about $86 per barrel in 2009.