Oil Prices Jump Again Following Gasoline, Distillate Draws

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rude oil prices jumped for a second day Wednesday, rising 33 cents to $66.40 a barrel following a Department of Energy report that showed drops in gasoline and distillate inventories, Bloomberg reported.

Benchmark light sweet crude futures reached $66.65 on the New York Mercantile Exchange, the highest in eight weeks, and prices are 23% higher than a year ago, Bloomberg said.

Prices had risen $1.89 a barrel on Tuesday to reach $66.07 a barrel. (Click here for previous coverage.)

Gasoline inventories plunged 5.3 million barrels last week, the biggest drop since August, DOE said in its weekly inventory report. That was a steeper decline than the 1.5-million barrel draw expected by analysts, Bloomberg reported.

Crude oil supplies rose 2 million barrels, the report showed, higher than the 950,000-barrel gain forecast.

Distillates inventories, which include diesel and heating oil, fell by 2.5 million barrels for the week, DOE said.

The gasoline additive MTBE, a groundwater pollutant, is being phased out of gasoline, and some worry that the fledging ethanol industry — to which the U.S. is expected to turn as an alternative — might not be ready to satisfy the expected summertime jump in demand, the Associated Press reported.