The surge in oil prices continued Wednesday, even after a government report showed supplies of crude unexpectedly grew last week, The Associated Press reports.
Benchmark crude for July delivery rose 88 cents to $77.82 a barrel on the New York Mercantile Exchange. The contract rose $1.82 to settle at $76.94 on Tuesday.
Drivers are seeing slightly higher retail gasoline prices. Pump prices on Wednesday rose 0.4 cent to $2.70 per gallon, according to AAA, Wright Express and Oil Price Information Service. Prices are 1.3 cents lower than a week ago and down 16.7 cents from a month ago. They are just 2.6 cents higher than year-ago levels.
Oil prices fell below $70 last month amid worries that Europe’s debt crisis would derail the global economic recovery and hurt demand for crude.
Although oil prices have recovered, supplies remain well above average. Crude supplies increased by 1.7 million barrels last week, the Energy Department’s Energy Information Administration said Wednesday. Analysts were looking for a decline of 1.75 million barrels.
Demand remains tepid in the U.S. with the unemployment rate staying stubbornly high. The report did show continued strong growth for refined products used by factories and truckers.
Industrial production has been a key part of the economic recovery with output at the nation’s factories, mines and utilities rising 1.2 percent in May, the Federal Reserve said Wednesday. That comes after April’s 0.7 percent increase.
“Consumers are not doing well, but the industrial economy is doing well,” said Mike Lynch, president of Strategic Energy & Economic Research.
In other Nymex trading in July contracts, heating oil rose 4.52 cents to $2.1137 a gallon, and gasoline gained 3.51 cents at $2.1566 a gallon. Natural gas lost 19.3 cents at $4.996 per 1,000 cubic feet.
Brent crude rose $1.10 to $78.20 a barrel on the ICE futures exchange.
