NEW YORK (AP) — The price of oil fell Wednesday as the prospect of the Federal Reserve pulling back on stimulus measures hung over the market.
Another factor: the government reported a smaller than expected decline in oil supplies and a rise in gasoline inventories.
Benchmark crude for September delivery dropped 93 cents to close at $104.37 a barrel on the New York Mercantile Exchange. Oil has fallen $2.57 so far this week.
This past week, a number of Federal Reserve officials have indicated that the central bank may be close to reducing a bond-buying program that has kept long-term interest rates low. Those low rates have helped boost investment in riskier assets like stocks and oil.
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The U.S. government’s Energy Information Agency said Wednesday that crude oil supplies fell 1.3 million barrels last week. Analysts were expecting a drop of 2 million barrels, according to Platts, the energy information arm of McGraw-Hill. In addition, gasoline supplies rose by 100,000 barrels, while analysts had forecast a 1 million barrel decline.
At the pump, the average price of a gallon of gasoline fell 1 cent to $3.60. That’s down 3 cents over the past week.
Brent crude, traded on the ICE Futures exchange in London, was down 74 cents at $107.44 a barrel.
In other energy futures trading on Nymex:
— Heating oil fell 4 cents to $2.96 a gallon.
— Natural gas fell 7 cents to $3.25 per 1,000 cubic feet.
— Wholesale gasoline fell 4 cents to $2.87 a gallon.
Source: AP
