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Oil Inventories Fall by More Than Expected by 1.2M Barrels Last Week: API

U.S. crude oil inventories declined by more than expected last week, the API reported Wednesday, just as summer travel is expected to bolster demand and keep gas prices at record highs. 

West Texas Intermediate, the U.S. benchmark, traded at $114.86 per barrel following the report after settling up 59 cents at $115.26 per barrel.

U.S. crude inventories fell by about 1.2 million barrels for the week ended May 26. That compared with a build of 567,000 barrels reported by the API for the previous week. Economists were expecting a decrease of about 67,000 barrels. 

The API data also showed that gasoline inventories fell by 256,000 barrels last week, while distillate stocks declined by about 858,000 barrels. 

The slip in gasoline inventories comes as Americans continue to feel the pain at the pump, with gas prices jumping to a record $4.67 a gallon on Wednesday.

Gas prices have surged as oil production remains below pre-pandemic levels, hindering the number of barrels that U.S. refiners can turn into products like gasoline. Fears of shortfall in supply come just as demand is set to pick up as summer travel gets underway. 

The official government inventory report due Thursday is expected to show weekly U.S. crude supplies fell by about 1.4 million barrels last week.

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