Energy Information Administration will release supply data at 10:30 a.m. Eastern By Polya Lesova, MarketWatch FRANKFURT (MarketWatch) -- Oil futures fell on Wednesday, pressured by a sharp increase in crude supplies and the euro's decline against the dollar after Portugal's credit rating was downgraded. Crude oil for May delivery dropped $1.35, or 1.6%, to $80.56 a barrel in electronic trading on Globex. The contract earlier hit an intraday low of $80.35 a barrel. Crude-oil inventories rose by 7.5 million barrels last week, as imports rose and refinery utilization declined, the American Petroleum Institute reported late Tuesday. The U.S. Energy Information Administration will release a separate report on inventories at 10:30 a.m. on Wednesday. Analysts polled by Platts estimate a commercial-crude-inventory increase of 1.67 million barrels for the week ended March 19. They also project a drop of 1.88 million barrels in gasoline supplies and a decline of 1.25 million barrels in distillate supplies. Also weighing on oil prices was the dollar's strength against most other major currencies. The dollar index (DXY 81.59, +0.70, +0.86%) , which measures the U.S. unit against a trade-weighted basket of six major currencies, rose 0.8% to 81.547. The euro fell 0.9% to $1.3366 after Fitch Ratings downgraded Portugal's long-term foreign and local currency ratings to AA- from AA, citing significant budgetary underperformance in 2009. Read the MarketWatch piece on Portugal. U.S. stock futures pointed to a lower opening on Wall Street, as European stocks turned lower following the downgrade of Portugal's ratings. In the U.S., data on durable-goods orders and new-home sales for February will be released on Wednesday.

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