BANGKOK – Oil rose to near $105 a barrel Wednesday, driven by speculation that U.S. crude stockpiles fell last week in a sign of higher demand.
Benchmark crude for August delivery was up $1.12 to $104.65 a barrel at early afternoon Bangkok time in electronic trading on the New York Mercantile Exchange. Earlier in the day it reached $104.79, which is oil's highest price since May 2 last year. The contract gained 39 cents to close at $103.53 on Tuesday.
Oil was higher after Bloomberg, a financial data provider, said U.S. crude inventories fell by 9 million barrels last week. It cited an unnamed person at the American Petroleum Institute, an industry group. The Energy Department releases its weekly report on U.S. inventories of crude oil and refined fuels later Wednesday.
A drop in supplies would suggest stronger demand and underline the signs of economic recovery shown in last week's stronger-than-expected U.S. hiring report.
Other factors that could influence trading Wednesday include OPEC's release of its monthly update on the oil market and the publication of minutes from the U.S. Federal Reserve's last policy meeting.
Brent crude, which is used to set prices for oil used by many U.S. refineries, was down 3 cents at $107.04 on the ICE Exchange in London.
In other energy futures trading on the New York Mercantile Exchange:
— Wholesale gasoline added 2.1 cents to $2.947 a gallon.
— Natural gas fell 2.3 cents to $3.634 per 1,000 cubic feet.
— Heating oil was steady at $2.986 per gallon.