Natural Gas Gains 3%

The Energy Information Administration said underground storage in the lower 48 states received a net injection of 104 billion cubic feet for the week ending May 21.
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WASHINGTON (

TheStreet

) -- Natural gas futures gained 3% Thursday despite inventory levels that rose beyond expectations last week.

In its standard weekly appraisal released Thursday, the Energy Information Administration said underground storage in the lower 48 states received a net injection of 104 billion cubic feet for the week ending May 21. The pickup easily outdistanced analysts' expectations that called for a rise of 98 to 102 billion cubic feet, according to a Platts survey.

Natural gas inventories remain abundant compared to historical figures, the report continued. Storage levels, which hit 2.269 trillion cubic feet last week, are 3.2% higher versus year-ago levels and are tracking 16.3% higher compared to the five-year average.

July natural gas futures pared some of their earlier gains following the report but finished 3% higher, gaining 12 cents, to settle at $4.29 per million British thermal units.

The

U.S. Natural Gas Fund

(UNG) - Get Report

ETF added 3% on the session.

Also on the Nymex, the July delivery crude oil contract surged 4.3% higher, adding $3.04 to settle at $74.55 a barrel alongside a broad rally in the equity market.

Stocks closed near session highs Thursday after a

Chinese agency refuted a

Financial Times

article alleging officials were reviewing the country's slate of euro bond holdings. The denial helped the

euro firm and the dollar dwindle, calming some jitters about the eurozone.

Oil futures also got some support Wednesday after the government reported both a supply drawdown at the much-watched Cushing, Okla., Nymex delivery site and declining fuel stockpiles.

The energy sector was the strongest of the session and the NYSE Arca Oil index soared 5.4% higher while the Philadelphia Oil Service Sector index gained 2.5%. Shares of

Dow

components

Exxon Mobil

(XOM) - Get Report

and

Chevron

(CVX) - Get Report

were traded markedly higher as well, adding 3.6% and 3.9%, respectively.

BP's

(BP) - Get Report

American depositary shares climbed 7% higher today as the firm appeared to be making headway with its so-called top-kill procedure, which aims at plugging up a gushing oil leak in the Gulf of Mexico.

But the burgeoning environmental disaster, which is threatening marine life in the southern U.S., has led to its first administrative casualty. Elizabeth Birnbaum, head of the Interior Department agency charged with regulating offshore drilling, resigned today, according to

The Associated Press.

Elsewhere, July heating oil futures added 8 cents, or 4%, to settle at $2.01 a gallon, while July gasoline was rose by 7 cents, or 3.6%, to settle at $2.04 a gallon.

--Written by Sung Moss and Melinda Peer in New York

.