Crude oil rose above $111 a barrel in New York and gasoline surged to a record after a government report showed that U.S. supplies unexpectedly dropped.
Crude oil inventories fell 3.15 million barrels to 316 million last week, the Energy Department said. A 2.3-million- barrel gain was forecast, according to a Bloomberg News survey. Metals futures also rose as the dollar fell against the euro, and gasoline pump prices reached a record average $3.343 a gallon.
``It looks like this move will accelerate and prices will move toward $115,'' said Tom Bentz, a broker at BNP Paribas in New York. ``This is all part of the big uptrend, and where it stops nobody knows.''
Crude oil for May delivery rose $2.49, or 2.3 percent, to $110.99 a barrel at 11:54 a.m. on the New York Mercantile Exchange. Futures reached $111.43, the highest since March 17, when prices touched a record $111.80 a barrel.
Gasoline for May delivery climbed 3.86 cents, or 1.4 percent, to $2.789 a gallon. Futures reached $2.8228, an intraday record for gasoline to be blended with ethanol, known as RBOB, which began trading in October 2005.
U.S. pump prices are following futures higher. Regular gasoline, averaged nationwide, rose 1.2 cents to the record, AAA, the nation's largest motorist organization, said today on its Web site.
Refineries operated at 83 percent of capacity last week, the Energy Department report showed. Plants used 88.4 percent during the same week last year. Refiners operated at 82.2 percent in the week ended March 21, the lowest since October 2005, the department said.
`Supportive'
``The report is supportive across the board,'' said Tim Evans, an energy analyst at Citigroup Global Markets Inc. in New York. ``I'm surprised gasoline isn't up more because of the larger-than-expected drop in inventories.''
Supplies of gasoline and distillate fuel, including heating oil and diesel, also fell. Gasoline inventories dropped 3.44 million barrels to 221.3 million last week, the report showed. A 3-million-barrel decline was expected.
``Domestic demand isn't great but that's not important,'' said Antoine Halff, head of energy research at New York-based Newedge USA LLC. ``Global demand is still growing and that's what matters.''
Total implied U.S. fuel demand averaged 20.5 million barrels a day in the past four weeks, down 0.4 percent from a year earlier, according to the department. Consumption was down 2.2 percent from a year earlier in the four weeks ended March 21.
`Speculation'
``Speculation is the main reason driving up oil prices,'' Qatari Energy Minister Abdullah bin Hamad al-Attiyah said today in Beijing. ``OPEC so far doesn't have anything on the agenda for the informal meeting in Rome.''
The Organization of Petroleum Exporting Countries will hold its next formal policy-setting conference in September. Many OPEC ministers will hold informal discussions during a conference in Rome on April 20-22. The group's 13 members produce more than 40 percent of the world's oil.
``OPEC has lost control of the oil market to institutional investors who are looking for a sanctuary from the weak dollar and slowing economy,'' said Richard Chimblo, manager of global business development at Calgary-based Genoil Inc. ``I believe the bubble will break and prices are going to fall to the $85 area before the winter heating season.''
Oil's 80 percent gain during the past year is the second biggest among 19 commodities on the Reuters/Jefferies CRB Index, trailing only wheat, which doubled. Rising global demand for raw materials and a weakening dollar have led to record prices this year for raw materials including corn, rice, gold and platinum.
Brent crude for May settlement rose $1.89, or 1.8 percent, to $108.23 a barrel on London's ICE Futures Europe exchange. Futures reached a record $108.77 a barrel in intraday trading.
Crude oil inventories fell 3.15 million barrels to 316 million last week, the Energy Department said. A 2.3-million- barrel gain was forecast, according to a Bloomberg News survey. Metals futures also rose as the dollar fell against the euro, and gasoline pump prices reached a record average $3.343 a gallon.
``It looks like this move will accelerate and prices will move toward $115,'' said Tom Bentz, a broker at BNP Paribas in New York. ``This is all part of the big uptrend, and where it stops nobody knows.''
Crude oil for May delivery rose $2.49, or 2.3 percent, to $110.99 a barrel at 11:54 a.m. on the New York Mercantile Exchange. Futures reached $111.43, the highest since March 17, when prices touched a record $111.80 a barrel.
Gasoline for May delivery climbed 3.86 cents, or 1.4 percent, to $2.789 a gallon. Futures reached $2.8228, an intraday record for gasoline to be blended with ethanol, known as RBOB, which began trading in October 2005.
U.S. pump prices are following futures higher. Regular gasoline, averaged nationwide, rose 1.2 cents to the record, AAA, the nation's largest motorist organization, said today on its Web site.
Refineries operated at 83 percent of capacity last week, the Energy Department report showed. Plants used 88.4 percent during the same week last year. Refiners operated at 82.2 percent in the week ended March 21, the lowest since October 2005, the department said.
`Supportive'
``The report is supportive across the board,'' said Tim Evans, an energy analyst at Citigroup Global Markets Inc. in New York. ``I'm surprised gasoline isn't up more because of the larger-than-expected drop in inventories.''
Supplies of gasoline and distillate fuel, including heating oil and diesel, also fell. Gasoline inventories dropped 3.44 million barrels to 221.3 million last week, the report showed. A 3-million-barrel decline was expected.
``Domestic demand isn't great but that's not important,'' said Antoine Halff, head of energy research at New York-based Newedge USA LLC. ``Global demand is still growing and that's what matters.''
Total implied U.S. fuel demand averaged 20.5 million barrels a day in the past four weeks, down 0.4 percent from a year earlier, according to the department. Consumption was down 2.2 percent from a year earlier in the four weeks ended March 21.
`Speculation'
``Speculation is the main reason driving up oil prices,'' Qatari Energy Minister Abdullah bin Hamad al-Attiyah said today in Beijing. ``OPEC so far doesn't have anything on the agenda for the informal meeting in Rome.''
The Organization of Petroleum Exporting Countries will hold its next formal policy-setting conference in September. Many OPEC ministers will hold informal discussions during a conference in Rome on April 20-22. The group's 13 members produce more than 40 percent of the world's oil.
``OPEC has lost control of the oil market to institutional investors who are looking for a sanctuary from the weak dollar and slowing economy,'' said Richard Chimblo, manager of global business development at Calgary-based Genoil Inc. ``I believe the bubble will break and prices are going to fall to the $85 area before the winter heating season.''
Oil's 80 percent gain during the past year is the second biggest among 19 commodities on the Reuters/Jefferies CRB Index, trailing only wheat, which doubled. Rising global demand for raw materials and a weakening dollar have led to record prices this year for raw materials including corn, rice, gold and platinum.
Brent crude for May settlement rose $1.89, or 1.8 percent, to $108.23 a barrel on London's ICE Futures Europe exchange. Futures reached a record $108.77 a barrel in intraday trading.
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