Crude futures soared past $109 a barrel before reversing course on government reports of increasing stockpiles.
Crude prices gained 0.5 percent to settle at $108.83 a barrel Wednesday, a new 2 1/2-year high. According to the Department of Energy's weekly report, crude oil rose by 1.5 million barrels last week. Stockpiles increased for the fifth consecutive week and have risen by more than 22 million barrels since the beginning of the year. Although the market is adequately supplied, speculations of "worst-case scenarios" in the Middle East and northern Africa continue to pressure prices. Approximately 1.3 million barrels a day are affected by the conflict.
Meanwhile, a tanker departed from an east Libyan port Wednesday carrying the first shipment of crude from the rebel-held region.
Demand for gasoline dropped by 357,000 barrels a day, as reported by the Department of Energy. Reports pressured gasoline futures to decline for the first time in seven sessions. Front-month gasoline settled at $3.193 a gallon, while prices fluctuated between $3.169 and $3.212 a gallon.
Natural gas futures fell for a fourth session on forecasts of warmer weather. May natural gas settled at $4.15 per thousand cubic feet, ahead of the Energy Information Administration's (EIA) weekly report scheduled for release tomorrow. The report will show the last withdrawal in U.S. stockpiles for the season. The intraday range for natural gas was $4.13 to $4.25 per thousand cubic feet.
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