LONDON, Aug 17: Oil prices plummeted by more than a dollar on Wednesday despite a massive slump in gasoline (petrol) reserves in the United States during the ongoing peak-demand summer driving season, dealers said.

Crude futures succumbed to profit-taking after an initial rally on publication of the US Department of Energy (DoE) report.

New York’s main contract, light sweet crude for delivery in September sank $1.28 to $64.80 per barrel in electronic trade.

In London, the price of Brent North Sea crude oil for delivery in October dropped $1.22 to $63.86 a barrel. The September contract expired on Tuesday at $65.41.

Recent supply fears, heightened by production outages at US refineries, pushed London Brent to a record $66.85 on Monday, while New York futures hit a historic high of $67.10 last Friday.

Wednesday’s DoE data showed that gasoline stockpiles dived by 5.0 million barrels in the week to August 12. That was the seventh straight weekly decline and was far more than forecasts of a 1.5-million-barrel drop.

The decline, which came as US oil companies drew down their stocks to cope with summer driving demand, put levels of gasoline supplies “near the bottom end of the average range” for this time of year, the DoE said.

Crude oil inventories rose by 0.3 million barrels to 321.1 million barrels, “well above the upper end of the average range for this time of year”, but below predictions of a 1.0-million gain.

Stockpiles of distillate fuel, which make heating oil and diesel, increased by 1.2 million barrels to 131.1 million, in line with market expectations of a 1.6-million-barrel increase.

“It’s bullish gasoline, it’s even bullish distillate, but it’s neutral crude,” summarised Societe Generale analyst Deborah White.—AFP