NEW YORK, May 26 (Xinhua) -- Oil prices surged on Thursday, bolstered by signs of tight supplies.
The West Texas Intermediate for July delivery added 3.76 U.S. dollars, or 3.4 percent, to settle at 114.09 dollars a barrel on the New York Mercantile Exchange. Brent crude for July delivery increased 3.37 dollars, or 3 percent, to close at 117.40 dollars a barrel on the London ICE Futures Exchange.
The rally came as the latest U.S. inventory data continued to show tight supplies.
The U.S. Energy Information Administration (EIA) reported Wednesday that the nation's crude oil inventories decreased by 1.0 million barrels during the week ending May 20. Analysts surveyed by S&P Global Commodity Insights had looked for crude to show a rise of 100,000 barrels.
According to the EIA, total motor gasoline inventories decreased by 0.5 million barrels last week and stood about 8 percent below the five year average for this time of year. Distillate fuel inventories increased by 1.7 million barrels in the above-mentioned period, but were around 21 percent below the five year average.
A tight fuel market was likely to remain in place given the start of the summer driving season, experts noted.
Traders also kept a close eye on the European Union (EU) as the bloc continued to work on a deal regarding an oil embargo against Russia.
Earlier this month, the EU unveiled a plan to phase out Russian crude oil within six months and refined products by the end of the year, as part of its sixth sanction package aimed against Moscow. The embargo requires unanimity from its 27 member states.