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Crude lower as U.S. oil inventories rise more-than-expected

Published 03/27/2013, 10:45 AM
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Investing.com - Oil prices were lower in U.S. trading on Wednesday after the Department of Energy reported that crude inventories rose more than expected last week.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in May traded at USD95.72 a barrel on Wednesday, down 0.63% and off from a session high of USD96.44 and up from an earlier session low of USD94.67.

U.S. crude oil inventories rose by 3.3 million barrels last week, after falling by 1.31 million in the preceding week and above market calls for a gain of 0.705 million barrels.

Gasoline inventories fell by 1.596 million barrels, after falling by 1.47 million barrels a week ago and beyond market calls for a decline of 1.020 million barrels.

Crude snapped a three-day rally on Wednesday as investors took profits after crude futures rose to a six-week high in the wake of Tuesday’s better-than-forecast U.S. economic data.

U.S. durable goods orders  rose 5.7% in February from a month earlier, and U.S. home prices posted their biggest year-on-year gain in six-and-a-half years in January, adding to signs that the country’s economic recovery is deepening.

Oil also came under pressure as the dollar strengthened against the euro, amid renewed concerns over the debt crisis in the euro zone.

The euro weakened broadly as investor focus shifted away from Cyprus back to Italy amid growing doubts over Italy's ability to form a stable government.

The head of Italy’s center-left alliance Pier Luigi Bersani ruled out forming a coalition on Wednesday, saying that only an “insane” person would want to govern the country.

Investors also remained concerned that the bailout deal for Cyprus could set a precedent for future bailouts in larger euro zone states, with big bank depositors and senior bond holders forced to suffer losses.

Elsewhere on the ICE Futures Exchange, Brent oil futures for May
delivery were up 0.24% at USD109.61 a barrel, up USD13.89 from its U.S. counterpart.



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