Oil prices fell Wednesday after the government's inventory report showed a surprise drop in gasoline and crude supplies but a less-than-expected draw in distillates used to make heating oil.
U.S. light crude for March delivery dropped $1.16 to $57.90 a barrel on the New York Mercantile Exchange. Oil rose immediately following the report before falling to current trading levels.
In its weekly inventory report, the Energy Information Administration said distillates, used to make heating oil and diesel fuel, declined by 3 million barrels last week. Analysts were looking for a decline of 4.2 million barrels, according to Reuters.
But crude stocks posted a surprise decline, falling by 600,000 barrels, while gasoline supplies declined by 2 million barrels.
Analysts were looking for a gain of 1.2 million barrels in crude stocks and a 1.9 million barrel addition to gasoline supplies.
Oil prices started out the year with a steep selloff, briefly falling below $50 a barrel as a mild winter swelled heating oil supplies and doubts lingered about OPEC's ability to cut production. The drop below $50 was 36 percent below oil's all-time non inflation adjusted trading high of $78.40 reached last July.
U.S. light crude for March delivery dropped $1.16 to $57.90 a barrel on the New York Mercantile Exchange. Oil rose immediately following the report before falling to current trading levels.
In its weekly inventory report, the Energy Information Administration said distillates, used to make heating oil and diesel fuel, declined by 3 million barrels last week. Analysts were looking for a decline of 4.2 million barrels, according to Reuters.
But crude stocks posted a surprise decline, falling by 600,000 barrels, while gasoline supplies declined by 2 million barrels.
Analysts were looking for a gain of 1.2 million barrels in crude stocks and a 1.9 million barrel addition to gasoline supplies.
Oil prices started out the year with a steep selloff, briefly falling below $50 a barrel as a mild winter swelled heating oil supplies and doubts lingered about OPEC's ability to cut production. The drop below $50 was 36 percent below oil's all-time non inflation adjusted trading high of $78.40 reached last July.
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