Ethanol production in the U.S. increased to 904,000 barrels a day last week, the Energy Department said today.

Stockpiles fell 1.5 percent to 21.2 million barrels, the biggest weekly drop and lowest level since May 11.

Production of conventional gasoline blended with ethanol fell 4.2 percent to 5.3 million barrels a day, the lowest amount since April 27 and the steepest decline since April 20, department said.

Denatured ethanol for July delivery advanced 3.4 cents, or 1.7 percent, to $2.065 a gallon at 10:35 a.m. New York time on the Chicago Board of Trade.

To contact the reporter on this story: Mario Parker in Chicago at mparker22@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net.