Oil Sets New Record: Over $115 A Barrel

With Peak Driving Season Approaching, Sagging Supplies Drive Price Of Crude Up Again

(AP)  Oil prices hit an all-time high above $115 a barrel Thursday amid concerns about sagging U.S. gasoline supplies ahead of the peak demand of the Northern Hemisphere summer.

The U.S. Energy Department said Wednesday that inventories of gasoline fell 5.5 million barrels last week, a much bigger decline than forecast by analysts surveyed by Dow Jones Newswires.

Crude inventories fell 2.3 million barrels last week, the department's Energy Information Administration also reported, while analysts expected a gain.

"The market has focused on the substantial draw in gasoline in the U.S. and also the large crude oil draw," said Victor Shum, an energy analyst with Purvin & Gertz in Singapore. "The report has provided a knee-jerk reaction for the market and has driven oil to a new high."

Light, sweet crude for May delivery rose as high as $115.45 a barrel in electronic trading on the New York Mercantile Exchange. It eased back to $114.94 a barrel, late afternoon in Singapore.

That is 1 cent higher than the overnight settlement record of $114.93 a barrel. During Wednesday's floor session, oil futures made their first move past the $115 mark.

The surge in oil prices reflected concerns about how much gasoline will be available during America's driving season.

But analysts said the U.S. inventory report also showed that the country's appetite for increasingly expensive gas is declining, noting that gasoline inventories remained at healthy levels despite the drop.

"Gasoline and crude inventories dropped primarily because refiners are not really ordering crude oil and they are also holding back on operating rates because demand is weak," Shum said. "The concerns about gasoline supply in the summer may be overdone."

The EIA report also said inventories of distillates, which include heating oil and diesel, unexpectedly rose last week by about 100,000 barrels. Analysts had expected a sharp decline.

Oil prices were also boosted by the falling dollar, which declined to a new low against the euro on Wednesday. Many investors buy commodities such as oil as a hedge against inflation and a falling greenback. A weaker dollar also makes oil cheaper to investors overseas.

"The market is driven by investors piling money into oil because of the weakening U.S. dollar. Until the dollar really stabilizes, financial investors will continue to prop up oil prices," Shum said.

In other Nymex trading, gasoline futures rose 1.8 cents to $2.957 a gallon while heating oil futures gained 1.36 cents to $3.2966 a gallon. Natural gas prices fell 0.5 cent to $10.428 per 1,000 cubic feet.

Brent crude futures rose 29 cents to $112.95 a barrel on the ICE Futures exchange in London.

[wardoglrs]

*** why in the hell wont they let farmers grow HEMP. Its far better than oil. Answer, cause it wouldnt be any fun not to tear into the forrest and destroy the land. Look into hemp and see for yourselves. We didnt need to log off everything and destroy it. Hemp is better than oil it can do far more good from clothes to fuel and paints and 25 thousand othere things and far less costly to produce and market

[mediapreachr]

Posted by ora734 at 11:55 AM : Apr 18, 2008
The government should start subsidizing diesel or people won''t afford to eat,than the real problems will begin.

[ov442]

Oil our friend, we must bathe in crude & raise oil in a toast to the sky!
Tomorrow is a new opportunity to reach a new record high!
Bush family, their allies - Oil barons My My!

Oil per barrel, 1 dollar a day it goes up yayy!!
Cant Afford to drive? think of it that way!!
To the Bush friends goes most of your pay!!!

[ora734]

It is apparent they do not care what happens to this economy just so long as their bank account is bigger, big deal, they have to pay the same as we do, which means all that money they are making, (and there are individuals out do this as a group or individually, some people feel superior if they perceive they know something everybody else don''t, 137) is worth half what it was worth before Bernacke and the oil spec start their imbecility. But like sharks feeding there''s no rhyme or reason to what their doing.

For instance the stock market is up, why? Citi posts looses going to lay off 9,000 this makes no since, unless there are factions running it up to get fool the mom and pop investors into (OH HAPPY DAYS ARE STILL HERE) and then pull the rug out, greatest depression ever..

[ora734]

All this talk don''t mean squat, email, call, write, congress demand they change the rules in the futures market to if you speculate with a necessity commodity that you have to take possession of the comm. for the very least 24-48 hrs. this will stop these parasites who are destroying this economy. I understand they are bought and paid for, but if enough of us yell loud enough they will get something done. If these parasites have to rent a tanker to take possession they will think long and hard about their actions.

Think about this the truckers are paying 4.& a gal. they get 3-5 mpg, when they have to pay 7.$ a gal how much you think it will cost for a piece of bubble gum. People really don%u2019t stop and think about what%u2019s coming, but it is coming and my wages will not keep up now let alone when we have to pay for 115.$ gas, right now we are paying on oil purchased that was purchased for 80.$.

[rbburnerjr]

Maybe everyone should email george so that he cannot say that he doesn''t know what price of gasoline! [e-mail]

[underdogus]

you''''re sick of these scum ruining America, please come to www.theoandavirus.com

Posted by Gailcumming....yeah we have plenty of kool aid..

[libsrweak]

Posted by ontheleft at 10:56 PM : Apr 17, 2008
+ report abuse

********

and they got you by the balls..and you are too weak..too patethic..too stupid and too misguided to do anything about it...

they deserve every penny they yank out of your arse.

[libsrweak]

hanks to all scumbag Republicans and the criminals that they support through bribes. If you''''re sick of these scum ruining America, please come to www.theoandavirus.com

Posted by Gailcummings at 11:21 PM : Apr 17, 2008
+ report abuse

******

then what?? you ride off to the sunset on your suv??

to make this work you need to get OFF your OWN dependency on oil..

[jerr11]

It''s true the astronomical price of oil is a result of supply and demand.

But if the dollar had not been devalued so much by the neocons, the price of oil would be around $70 a barrel today. Still high by any standards but not the crazy price of over $100 a barrel.

We''ve been screwed by the neocons.

While they lowered taxes for the rich, they devalued the dollar so every dollar we had is now worth only 60 cents!

Talk about highway robbery!

Heckuva job, Liar-ib-Chief!