01/16/2013 04:17 EST | Updated 03/18/2013 05:12 EDT

Oil jumps above $94 a barrel on unexpected drop in US supplies

The price of oil jumped above $94 a barrel Wednesday after an unexpected drop in U.S. crude supplies.

Benchmark oil was up 96 cents to close at $94.24 a barrel on the New York Mercantile Exchange.

Oil supplies fell by 1 million barrels, or 0.3 per cent, to 360.3 million barrels last week. Analysts expected an increase of 2.5 million barrels. The drop was due mainly to a decline in imports. Gasoline supplies grew less than expected as refineries slowed output.

Still, supplies of oil and gasoline remain above average for this time of year, with crude inventories nearly 9 per cent higher than a year ago and gasoline levels more than 3 per cent higher. U.S. production of crude, at more than 7 million barrels a day, is the highest in 20 years.

Going forward, traders will be watching for the latest reading on China's economic growth Friday and developments in contentious negotiations in Washington over the nation's borrowing limit.

Brent crude, used to price international varieties of oil, was up 5 cents to $119.68 per barrel on the ICE Futures exchange in London.

In other energy futures trading on Nymex:

— Wholesale gasoline rose 1 cent to $2.72 a gallon.

— Natural gas lost 2 cents to $3.44 per 1,000 cubic feet.

— Heating oil fell 1 cent to $3.00 a gallon.