Crude oil price rises above US$100 a barrel on surprise fall in stockpiles

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The price of oil rose above US$100 a barrel Wednesday on a surprise decline in U.S. supplies and the continuing conflict in Ukraine.

Benchmark West Texas Intermediate crude for June delivery rose $1.27 to close at US$100.77 a barrel on the New York Mercantile Exchange. Brent crude, a benchmark for international varities used by many U.S. refineries, rose $1.07 to close at US$108.13 a barrel in London.

The U.S. Energy Department reported Wednesday that American crude oil stocks fell by 1.8 million barrels last week. Supplies are still higher than their five-year average for this time of year, but the drop surprised traders.

Analysts had expected an increase of 1.3 million barrels in crude oil stocks, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.

Tension between Russia, a major oil and gas exporter, and western countriess over the fate of Ukraine’s restive eastern regions has kept upward pressure on energy prices in recent weeks.

Traders worry that the flow of Russian crude could be interrupted. The U.S., Canada, and European copuntries have imposed sanctions on some individuals and parts of the Russian economy, though the sanctions have so far avoided Russia’s energy industry.

In other energy futures trading on Nymex, wholesale gasoline rose 3.2 cents to close at US$2.918 a U.S. gallon (3.79 litres), heating oil rose four cents to close at US$2.928 a gallon and natural gas fell 5.9 cents to close at US$4.74 per 1,000 cubic feet.

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