Oil prices rise as US supplies fall

Oil prices continued to rise Friday as a government report showed that US crude inventories fell more than expected. The Energy Information Administration said Friday that U.S. crude stockpiles fell 4.73 million barrels to 367.6 million barrels for the week ending Dec. 20, far above the projected 2.3- million-barrel decline. Refineries operated at 92.7 percent of capacity, up 1.2 percentage points from the prior week, said the Energy Department' s statistical arm. A dip in U.S. supplies signaled strong demand in the world's biggest economy and oil consumer. The report came amid signs that the U.S. economy is picking up. The number of Americans who initially applied for jobless benefits dropped 42,000 to 338,000 in the week ending Dec. 21, the Labor Department said Thursday. The market forecast called for a drop to 345,000. Adding some optimism into the market, U.S. President Barack Obama has signed a bipartisan budget bill which covers spending levels for the next two fiscal years, the White House said on Thursday. The bill would prevent another possible government shutdown in January. Light, sweet crude for February delivery gained 77 cents to settle at 100.32 U.S. dollars a barrel on the New York Mercantile Exchange, while Brent crude for February delivery increased 20 cents to close at 112.18 dollars a barrel.