Crude prices rise on shrinking inventories

Crude prices gained Wednesday as a government report showed that U.S. crude supplies fell last week.

U.S. crude stockpiles decreased 4 million barrels to 371.1 million barrels last week, the Energy Information Administration ( EIA) said Wednesday. Stockpiles at Cushing, Oklahoma, the delivery point for U.S. crude, fell 1.5 million barrels to 18.8 million.

Meanwhile, U.S. crude production dropped 27 thousand barrels a day to 8.565 million last week.

Traders were also closely watching latest developments in the Ukraine and Middle East.

The Ukrainian government said Wednesday that two fighter jets were shot down in eastern Ukraine, near the crash site of the Malaysian Airlines passenger plane.

Meanwhile, U.S. Secretary of State John Kerry flew Israel to push for a truce between Israel and Hamas as fighting rages in Gaza.

Light, sweet crude for September delivery moved up 73 cents to settle at 103.12 U.S. dollars a barrel on the New York Mercantile Exchange, while Brent crude for September delivery gained 70 cents to close at 108.03 dollars a barrel.