Oil Prices Jump on Rumor of Saudi Cuts

By Mark Williams

Columbus, Ohio -- Oil prices rose in volatile trading Wednesday after rumors spread that Saudi Arabia told major customers of significant production cuts.

Prices quickly had given up strong early gains after the government reported U.S. gasoline inventories were well above expectations, suggesting that American motorists continue to drive less.

Around midday, however, prices spiked close to 10%, the same time the Saudi rumor began to float, said Phil Flynn, an analyst with Alaron Trading Corp. ...