3/5/08 - WTI April Delivery Closes Above $104 For First Time - Marketwatch

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SAN FRANCISCO (MarketWatch) -- Crude-oil futures on Wednesday surged $5 to close above $104 a barrel for the first time, rallying after data showed U.S. inventories fell unexpectedly and after the Organization of Petroleum Exporting Countries decided to keep its production levels unchanged.

Crude prices were also boosted by the weak dollar, which set a new low against euro on Wednesday, and by increasing flows of investment funds into the oil market. Wednesday's gain in crude was the biggest in value since crude futures started trading on the New York Mercantile Exchange in 1983. Also on Nymex, natural-gas and heating-oil futures hit a new high, while gasoline prices also moved up although data showed U.S. gasoline inventories rose to the highest level in 14 years.

Crude for April delivery rallied $5, or 5%, to settle at $104.52 a barrel on Nymex. It soared to $104.95 in electronic trading after floor session was closed. Crude's recent levels have already passed its inflation-adjusted historic highs. See story on historical records.

U.S. government data showed crude inventories in the world's largest oil consumer fell for the first week in eight, dropping 3.1 million barrels to stand at 305.4 million barrels in the week ended Feb. 29. Analysts surveyed by commodities information provider Platts had been expecting an increase of 2.1 million barrels on the week.

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