Oil prices rose Wednesday after energy traders shrugged off OPEC's decision to boost its output target and a government report showed that domestic supplies shrank last week amid higher gasoline demand.

The Energy Department's weekly supply snapshot showed U.S. inventories of crude oil fell by 1.8 million barrels last week to 329 million barrels, leaving supplies almost 9 percent above year-ago levels.

Light sweet crude for July delivery rose 57 cents to settle at $55.57 per barrel on the New York Mercantile Exchange. Prices climbed as high as $56.75 earlier in the day. In London, Brent crude futures rose 71 cents to settle at $54.45 a barrel on the International Petroleum Exchange.

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