Oil prices take unexpected jump

Posted: Thursday, April 08, 2004

WASHINGTON (AP) Oil and gasoline futures prices shot up more than 3 percent Wednesday after the government reported a decline in supplies, surprising energy traders.

The price of crude for May delivery rose $1.18 to $36.15 per barrel on the New York Mercantile Exchange, where May gasoline futures moved 3.91 cents higher to $1.113 per gallon.

''This is the time of year when we're supposed to be building crude inventories'' at a rate of about 2 million barrels per week, said Ed Silliere, vice president of risk management at Energy Merchant in New York.

Instead the Energy Department reported that commercially available oil supplies fell by 2.1 million barrels to 292.2 million barrels for the week ended April 2, leaving nationwide inventories 20.9 million barrels below the 5-year average for this time of year. Still, supplies are about 4 percent above year-ago levels.

Gasoline supplies fell by 800,000 barrels, putting them 5.5 million barrels below the 5-year average and even with last year, according to the federal agency.

At the retail level, the average price of gasoline nationwide is $1.77, according to AAA a record in nominal terms, although not when adjusted for inflation.

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