LONDON, April 7: Oil prices shot higher on Wednesday as a surprise fall in US inventories rekindled supply fears. The price of benchmark Brent North Sea crude oil for May delivery surged $1.26 to $32.61 per barrel in late deals.
New York's reference light sweet crude May contract rallied $1.21 to $36.18 a barrel in early trading. "The market is reacting strongly to the stock numbers," said Deutsche Bank analyst Adam Siemenski.
"Market consensus was for stocks to be 1.5 million barrels higher but is now faced (with) large draws," he added. A survey by the Department of Energy found US commercial crude oil inventories fell 2.1 million barrels to 292.2 million barrels in the week ending April 2.
A rival private survey by the American Petroleum Institute (API) found crude oil stocks fell by 2.3 million barrels to 292.3 million in the same period. According to the government survey, gasoline inventories dropped 800,000 barrels to 200.1 million barrels. According to the API, gasoline inventories fell 1.5 million barrels to 196.4 million.
Dealers are fearful of gasoline shortages in the United States this summer when demand rises as Americans take to the roads for their holidays. "We were expecting a stock build (increase) and of course it's a drought across the board, which caused the very rapid reaction on the market," said Refco market analyst Marshall Steeves in the US. -AFP
