Oil prices jumped Thursday as new U.S. government data showed oil inventories fell unexpectedly, according to AP. Light, sweet crude for April delivery rose $1.83 to $39.24 on the New York Mercantile Exchange. The vast majority of trades have shifted to April, with the March contract expiring Friday. Benchmark crude for March delivery surged 7.9 percent, or $2.73, to $37.35. Prices also were getting support by a weaker dollar compared with the euro. Oil tends to rise when the dollar drops as investors use the commodity as a hedge against inflation. The Energy Information Administration said crude stocks decreased 200,000 barrels to 350.6 million barrels for the week ended Friday. Analysts had expected stock to grow by 3.5 million barrels, according to Platts, the energy information arm of McGraw-Hill Cos. Inventories have risen more than 30 million barrels in the prior six weeks. Even with the decline, crude supplies remain ample and U.S. oil storage sites, including the main depot in Cushing, Oklahoma, are brimming with crude, reflecting the drop-off in demand. Storage levels have been approaching marks last seen in the summer of 1990 when Iraq invaded Kuwait. Yet a stunning drop-off in driving by Americans has led to growing levels of gasoline in storage. Total gasoline inventories rose 1.1 million barrels last week, or 0.5 percent, to 218.7 million barrels compared with analyst projections of a decline of 1 million barrels.Distillate inventories, used for heating oil and diesel fuel, declined by 800,000 barrels to 140.8 million barrels compared with projections of a decline of 1.5 million barrels. At the same time, U.S. refineries ran at 82.3 percent of total capacity on average, an increase of 0.7 percent from the prior week. Analysts expected utilization to slip to 81.35 percent. The Department of Transportation said Thursday that motorists drove 3.8 billion fewer miles in December _ when gasoline prices bottomed at $1.61 a gallon after reaching $4.11 in July _ than they did in December 2007. The 1.6 percent decline in driving marks the 14th consecutive month of declining driving with the decline totaling 115 billion miles.
