Crude oil falls after big jumps

CRUDE oil in New York fell after reaching a 13-year high on concern that US gasoline inventories are too low to meet demand during the warm-weather months.

“We rose too far too fast yesterday,” said Carl Larry, vice president of global energy sales for ABN Amro Inc in New York.

Prices rose above $38 a barrel for the first time since the 1990-91 Persian Gulf War after the Energy Department said gasoline supplies fell 800,000 barrels to 199.6 million last week.

Prices have also risen because of OPEC’s agreement to cut output quotas, analysts said.

Crude oil for April delivery was down 28 cents, or 0.7%, at $37.90 a barrel at 11:49am on the New York Mercantile Exchange. Prices were 20% higher than a year earlier.

The decline in gasoline stockpiles left US reserves at their lowest since November. Supplies stand 5% below the five-year average, sparking concern that refiners will struggle to meet demand when the driving season begins in May.

Crude-oil inventories rose 1.6 million barrels to 281.1 million, the highest since November.