Oil Rises on Steep Gasoline Inventories Decline

NEW YORK, Aug. 17 (Xinhua) -- Crude prices rose on Wednesday as the U.S. gasoline inventories declined sharply last week.

According to data from the U.S. Energy Information Administration (EIA), the gasoline stock dropped 3.5 million barrels in the week ended August 12, far beyond expectations, which was very bullish to crude prices. But the EIA also reported a sharp increase of 4.2 million barrels for crude inventories, posing pressure on crude markets.

The mixed inventories report caused volatility, with U.S. crude swinging between 86.65 dollars to 89.00 dollars a barrel.

And the dollar fell against the euro, although the Germany- France summit turned out to be disappointing with concerns over European debt crisis persisting.

On the economic data front, the U.S. producer price inflation rose surprisingly in July despite lower energy prices.

Light, sweet crude for September delivery rose 93 cents, or 1. 07 percent to settle at 87.58 dollars a barrel on the New York Mercantile Exchange. In London, Brent crude for October delivery also gained and last traded above 110 dollars a barrel.