Oil idled in the $101 range Wednesday at mid-day after the U.S. Energy Information Administration announced that weekly crude oil inventories surged higher.

Oil gained 12 cents to $101.10 per barrel, off highs earlier in the session, after the EIA said weekly crude oil inventories increased 7.4 million barrels for the week ending March 28, 2008.

Crude oil inventories totaled 319.2 million barrels. Gasoline inventories declined 4.5 million barrels. Distillate stocks fell 1.6 million barrels.

Historically, oil inventories increase as the spring quarter approaches, the lowest oil use quarter in the United States.

Energy commodities mixed

The other major energy commodities were mixed on the news in early trading Wednesday. Heating oil fell about 1 cent to $2.98 per gallon, unleaded gasoline added 2 cents to $2.65 per gallon, and natural gas declined about 28 cents to $9.44 per million BTUs.

Further, refinery capacity edged slightly higher, which is rare for early spring. Refineries operated at 82.4% of their operable capacity last week, up from a revised 82.2% for the week ended March 21, 2008. Historically, refinery capacity declines in the initial weeks of the spring, as refiners perform maintenance and convert systems to gasoline production from heating oil production.

Oil Analysis: A bearish oil report, which is good news for U.S. consumers and businesses. Crude oil inventories continue to rise -- a two-month trend -- on a pull-back in demand. The decline in gasoline inventories is a note of concern, after recording flat gasoline inventories last week, but that data point can be overlooked, for now, provided gasoline inventories start to build again as the spring season continues. The positive impact of the oil inventory build is obvious enough; it will help take pressure off record-high oil and gasoline prices, which serve as a de facto tax on U.S. consumers. If oil and gasoline prices moderate, that will increase U.S. disposable income in the months ahead -- an added stimulus for the anemic U.S. economy, an economy that needs all the stimulus it can get.