* U.S. crude stocks fall 7.2 million barrels -EIA
* U.S. crude imports lowest since 1997
* Libya's big western fields shut, new fighting breaks out
* Russia pulls back from Ukraine border
* Federal Reserve talks tightening monetary policy
(Updates with settlement prices, adds analyst commentary)
By Elizabeth Dilts
NEW YORK, May 21 U.S. oil reached a one-month
high on Wednesday, rising nearly $2 a barrel, after the
government reported a large draw in commercial crude stocks,
while renewed fighting in Libya that kept output low boosted
U.S. crude stocks fell last week as imports slumped to the
lowest since 1997, while gasoline and distillate inventories
rose, the U.S. Energy Information Administration reported.
Crude inventories fell 7.2 million barrels last
week, while net crude imports fell 658,000 barrels per day (bpd)
to a record low of 6.4 million bpd.
The industry group American Petroleum Institute reported a
10 million barrel draw late on Tuesday, which helped oil make a
modest rally overnight that extended after the EIA report.
Brent crude settled 86 cents up at $110.555 a
barrel. U.S. crude rose by as much as $1.96 to touch an
intra-session high of $104.29 a barrel. It settled up $1.74 at
$104.07 a barrel.
The strength in U.S. crude pulled U.S. gasoline prices
higher in spite of a nearly 1 million-barrel build last week.
U.S. gasoline RBOB futures settled 3 cents up at $2.9942
"We had a massive drawdown that started the movement on the
API data yesterday," Bill Baruch, senior market strategist at
iitrader.com. "There's fear with Libya, there's fear with
Russia, we're heading into a long weekend, and all of that leads
to a path of zero resistance higher."
Explosions and fighting were heard in Tripoli on Wednesday,
two days after gunmen stormed parliament amid a surge in
violence in the OPEC member country.
National output in Libya edged higher to 230,000 barrels per
day (bpd), up from 210,000 bpd on Monday but still a fraction of
the 1.6 million bpd the country produced before the 2011 war.
Two large oilfields were still shut 10 days after the
government said protests there were over.
Ukraine, where presidential elections are set to be held
Sunday, remained a background support for Brent. Tensions
appeared to be easing as Russia announced it has drawn back
troops from three provinces along the Ukraine border.
A part from geopolitical risk, U.S. oil got a bump from
gains in equities. The U.S. stock market rose after minutes from
the Federal Reserve's latest meeting showed central bankers have
discussed the eventual tightening of monetary policy but made no
decisions on which tools to use.
Floor trading will be closed on Monday and there will be no
settlement on the New York Mercantile Exchange due to the U.S.
Memorial Day holiday.
(Additional reporting by Alex Lawler in London and Jacob
Gronholt-Pedersen in Singapore; editing by Jane Baird, Keiron
Henderson, Cynthia Osterman and Chizu Nomiyama)