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Commodity Online

NEW YORK: World oil prices continued its upward journey Wednesday after US energy report said refinery utilization had dropped to the lowest point since October 2005.

New York's main oil contract, light sweet crude for delivery in May, jumped $US4.68 to close at $US105.90 per barrel. London s Brent North Sea crude for May rose $US3.39 to settle at $US103.99.

Futures were already trading about $US2 higher before the US Energy Information Administration released oil and product inventory data, adding another $US1 after the release.

Prices were supported by strong demand and stretched global supplies, which were further pressured by the OPEC cartel's decision to maintain its output levels earlier this month.

The data showed refinery utilisation at 82.2 per cent, the lowest level since October 2005.After prices fell about 10 per cent over a one week period starting March 17, the market appeared to have begun a rebound, now fuelled by the EIA figures.

Having survived last week's correction, the market is now testing new heights, analysts and traders said. Oil prices fell last week over concerns about the struggling US economy slowing demand, as well as the strengthening US dollar. The US dollar is back on the retreat against the euro, helping to send futures higher yesterday.

The EIA data showed an 88,000 barrel build in oil inventories for the week ending March 21. Petrol stocks fell by 3.3 million barrels, more than four times what analysts expected, while distillates fell by 2.1 million barrels, also more than forecast.

Front month April RBOB recently traded higher by US5.48c (2 per cent) at $US2.7350 a gallon, after hitting a record $US2.7752. April heating oil traded higher by US9.52c (3.3 per cent) at $US3.02 a gallon.