U.S. commercial crude oil inventories dropped by 5 million barrels to 314.7 million barrels in the week ended Jan. 5, the Energy Department reported Wednesday.

However, gasoline inventories rose 3.8 million barrels to 213.3million last week while supplies of distillate, which include heating oil and diesel fuel, were up 5.4 million barrels last week to 141 million barrels.

Affected the latest report, crude for February delivery dropped1.62 dollars, or 2.91 percent, at 54.02 dollars a barrel on the New York Mercantile Exchange after touching a low of 53.80 dollars, the lowest level since late May 2005.

London Brent crude fell 1.49 dollars at 53.69 dollars a barrel.

Unusual mild weather throughout the United States and over the world has driven crude prices down this winter. Since the beginning of 2007, crude future at the New York market has lost 11.5 percent.