Crude prices fall after inventories report

Crude oil prices were lower Wednesday in the wake of the latest US inventories report from the Energy Information Administration.

March contracts for West Texas Intermediate crude rose slightly right after the EIA data was issued, but by just before 2 p.m. in New York WTI for March had dropped $1.49 to $73.22 per barrel on the New York Mercantile Exchange.

The EIA reported that crude oil inventories in the US unexpectedly fell by 3.9 million barrels to 326.7 million barrels in the week ending 22 January, instead of rising by 2 million barrels, as had been anticipated.

However, gasoline stockpiles added 2 million barrels last week rather than the expected gain of 1.7 million barrels, and distillates in storage, including heating oil and diesel fuel, were up by 400,000 barrels instead of dropping by 1.8 million barrels as had been expected.

The EIA also reported that demand for gasoline is down 0.8 percent in the past four weeks over the same period last year, and that refineries operated at 78.5 percent of capacity last week.

Nymex February gasoline futures and March heating oil futures each fell 4 cents in afternoon trade, to $1.93 per gallon and $1.92 per gallon respectively, while March natural gas was down 21 cents to $5.22 per million British thermal units.

The retail price of a gallon of gasoline in the US was down 0.5 cent overnight to $2.695 per gallon on average, according to AAA, down about 4 cents from a week ago but still 86 cents higher than last year at this time and a bit over 9 cents more expensive than last month.