The US oil supply unexpectedly plummeted last week — and it could keep gas prices high for longer

The US oil supply unexpectedly plummeted last week — and it could keep gas prices high for longer

Oil supply strains are already hitting the US harder than expected. The country's commercial crude oil inventory dropped by 2.5 million barrels to 413.4 million barrels last week, the said Wednesday. The total supply now sits roughly 13% below the five-year average for this time of year, meaning oil is in unusually short supply. The print also falls extremely short of economists' expectations. Experts surveyed by Bloomberg projected a 114,000-barrel increase in supply through the week. The 2.5-million-barrel decline doesn't just blow their forecasts out of the water, it also marks the largest one-week drop in oil supply in a month. Wednesday's inventories data sparked the latest upswing in oil prices. — the US's benchmark for oil prices — gained as much as 6.2% on Wednesday as traders digested the huge miss in US inventories. — the international oil benchmark — also rose on the news, trading as much as 6.8% higher to $122.34 per barrel. Gas supply is also under pressure. Motor gasoline inventories slid by 2.9 million barrels last week and now sit at the bottom end of the five-year average for this time of year. The declines extend a broad, months-long slump in US oil and gas