Oil prices climbed above $77 a barrel on Thursday -- a first for the year -- after a bullish government showed a surprise drop in gasoline stockpiles and a lower-than-expected rise in crude inventories.
Oil for November delivery rose $1.88, or 2.5%, to $77.06 a barrel in midday trading, after hitting an intraday high of $77.28.
The Energy Information Administration reported a modest increase in crude stocks of 400,000 barrels in the week ended Oct. 9. Analysts were expecting a rise of 2.2 million barrels, according to a consensus estimate collected by energy information provider Platts.
The government report showed a surprising and sharp decrease in gasoline stockpiles by 5.2 million barrels. Analysts expected an increase of 1.6 million barrels.
The government report also showed that distillates, used to make heating oil and diesel, decreased 1.1 million barrels, slightly above analysts' expectations of a one million-barrel decrease.
