LONDON (SHARECAST) - Crude oil futures fell almost 2% on Wednesday after a weekly government report showed a surprise increase in crude oil supplies while the Federal Reserve’s cautionary comments about the economic outlooksparked a dose of nerves.
Crude oil futures for August delivery slipped $1.50 to settle at $76.35 a barrel after falling to an earlier low of $75.17 a barrel.
As expected, the Fed kept rates on hold and reiterated that they would be kept ultra low for some time. In its accompanying statement the Fed said, Financial conditions have become less supportive of economic growth on balance, largely reflecting developments abroad."
Meanwhile the Energy Information Administration reported a sharp increase in crude oil inventories, up 2m barrels in the week ended 18 June. Analysts had expected a decline of 1.5m barrels.
Gasoline stocks declined by 800,000, the EIA said, more than the 500,000 decline expected by analysts. Distillates, used in heating oil, increased 300,000 barrels, less than predictions of a 1.4m barrel increase.
Gold futures also settled lower after the Fed reiterated that interest rates would remain low for some time.
COMEX gold for August delivery fell $6.00 to $1234.80 an ounce on the Comex division of the New York Mercantile Exchange.
Silver for July delivery fell 44 cents to settle at $18.45 an ounce while copper for July fell 6 cents to $2.93 a pound.
