The gain of almost 5 percent Wednesday brought crude oil on the New York Mercantile Exchange to its highest close since Nov. 27.

Crude supplies fell 700,000 barrels during the week ended Dec. 7, according to a weekly inventory report from the Energy Department's Energy Information Administration. Analysts surveyed by Dow Jones Newswires had expected a 100,000 barrel increase.

Also, the Fed said it was working with other central banks to try to counter the credit crisis, alleviating some investors' disappointment in Tuesday's cut in interest rates of just a quarter percentage point.

The Fed said its plan in conjunction with central banks in Canada and Europe will create a temporary auction facility to make funds available to banks and set up lines of credit for additional resources. The move is the biggest concerted liquidity injection since the aftermath of the Sept. 11, 2001, terrorist attacks and initially boosted investor sentiment that it would spur economic growth and oil demand.

Light, sweet crude for January delivery fell 26 cents to $94.13 a barrel in Asian electronic trading by late morning in Singapore. The Nymex crude contract gained $4.37 Wednesday to settle at $94.39 a barrel.

A drop in the supplies of distillates, which include heating oil and diesel fuel, also helped to lift prices. The EIA said distillate stocks fell 800,000 barrels while the analysts polled by Dow Jones Newswires had predicted a gain of 300,000 barrels.

Total oil and product inventories have fallen for several straight weeks, which is normal for this time of year, but they remain high by historical standards, according to the EIA. Analysts said this week's report also contained elements that could undercut prices, including a 1.4 million barrel increase in oil supplies at the closely watched Nymex delivery terminal in Cushing, Okla.

But the market appeared to be more focused on the overall crude and heating oil numbers. Some analysts were perplexed by the focus on heating oil, noting that supplies often fall this time of year.

The EIA said gasoline supplies rose last week by 1.6 million barrels. Analysts had, on average, expected a 1.2 million barrel increase.

It also said that refinery activity fell 0.6 of a percentage point last week to 88.8 percent of capacity. Analysts had expected an increase of 0.1 percentage point to 89.5 percent of capacity.

Reports of a fire at a 350,000 barrel-a-day Exxon Mobil Corp. refinery in Texas helped boost gasoline and heating oil prices Wednesday, analysts said.

In Asia, heating oil and gasoline futures were down from their closings in the previous session. Heating oil dropped 0.87 cent to $2.6345 a gallon, while gasoline fell 1.5 cents to $2.3978 a gallon.

November natural gas futures rose 8 cents to $7.488 per 1,000 cubic feet.

In London, January Brent crude fell 52 cents to $93.50 a barrel on the ICE Futures exchange.