By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures turned lower Wednesday as a bearish inventories report and losing equities chipped away at earlier gains.
Crude for November delivery (CLX10 74.45, -0.52, -0.69%) , the front-month contract, declined 48 cents, or 0.6%, to $74.52 a barrel on the New York Mercantile Exchange.
Gasoline futures also turned lower after the Department of Energy’s Energy Information Administration report, but natural-gas futures held on to earlier gains.
The EIA said oil inventories for the week ended Sept. 17 rose 1 million barrels. Oil had traded around $75.30 a barrel before the report, which gave prices a brief boost as it showed an increase below what a trade group had reported earlier in the week.
The increase ran contrary to analysts’ expectations. Analysts polled by Platts expected a decline of 1.5 million barrels for the week.
Gasoline stocks rose 1.6 million barrels; analysts had seen it unchanged. Reserves of distillates, which include diesel and heating oil, rose 300,000 barrels, the EIA said. They were forecast to increase 100,000 barrels, according to Platts.
The EIA report was “very surprising,” said Tariq Zahir, a managing member at Tyche Capital Advisors. With the Enbridge Energy Partners LP (EEP 54.34, +0.97, +1.82%) pipeline shut down during the previous week, “everything was in order to see draws across the board,” he said.
The high inventories, coupled with the lack of any significant hurricanes hitting the oil-producing areas in the Gulf of Mexico, are likely to send crude prices lower in the short term, Zahir added.
The dollar index (DXY 79.88, -0.56, -0.69%) , which compares the greenback with six other currencies, was 0.9% lower at 79.73.
A weaker dollar is generally positive for commodities as it makes them less expensive for holders of other currencies and broadens their investment appeal.
Oil declined nearly 2% on Tuesday. The Federal Reserve said it was ready to help the economy but didn’t provide concrete steps to ease monetary policy in a pronouncement that also hit the dollar.
Meanwhile, natural gas for October delivery (NGV10 3.94, +0.02, +0.56%) added 3 cents, or 0.6%, to $3.94 per million Btus. Prices hovered briefly above $4 per million Btus.
Reformulated gasoline turned lower on Wednesday after the EIA report. Gasoline for October delivery retreated 4 cents, or 1.8%, to $1.88 a gallon. That’s gasoline lowest price in three weeks.
