NEW YORK (AP) — Oil dropped below $110 per barrel on Wednesday after a government report showed that supplies of petroleum products are growing as demand weakens in the U.S.
Industry reports on the job market and the service sector also raised concerns about the health of the U.S. economy.
Benchmark crude for June delivery lost $1.81 to settle at $109.24 per barrel on the New York Mercantile Exchange. In London, Brent gave up $1.26 to settle at $121.19 per barrel on the ICE Futures exchange.
Prices fell shortly after the Energy Information Administration said that oil supplies increased by 3.4 million barrels last week — twice as much as energy analysts expected. The government also reported that gasoline demand averaged 9.1 million barrels per day, down almost 2% from a year ago.
Crude has been climbing over the past few months as unrest in North Africa and the Middle East raised concerns about oil supplies and a weaker U.S. dollar made crude cheaper for investors holding foreign money.