Crude oil prices down on increased gasoline inventories

Crude oil prices fell significantly on Wednesday after reports showed that gasoline inventories were up 0.4 million barrels last week, when a decline of nearly 2 million barrels had been expected. Crude oil inventories were 0.6 million barrels lower, but that was much less than the 1.2 million barrel decline that had been predicted due to the loss of production from BP’s Prudhoe Bay, Alaska field.

Brent crude for October delivery was $1.44 lower to $71.80 per barrel in London, while October contracts for West Texas Intermediate crude on the New York Mercantile Exchange dropped $1.65 to $71.45 per barrel. In addition, Nymex September unleaded gasoline was down by nearly 9 cents to $1.8525 per gallon.

Prices have dropped below $3 per gallon on average in the United States, with more declines expected. While US gasoline demand was up by 1.7 percent last week to 9.61 million barrels per day, it remained below the record demand of 9.7 million barrels per day set earlier in the summer.

In metals markets on Wednesday, precious metals prices stayed close to previous levels. Gold was up slightly to $623.70 per troy ounce. Silver sat at $12.30 per troy ounce, while platinum sold for $1,228 per troy ounce and palladium brought $341 per troy ounce.

Among base metals, nickel and copper prices were both lower. Three-month nickel dropped 4 percent to $28,750 per tonne after hitting a new record on Tuesday. London Metal Exchange inventories were up 174 tonnes to 1,956 tonnes, but supplies were still tight and cash prices were at $33,325 for the session.

Three-month copper fell 0.6 percent to $7,575 per tonne as there was still no solution in sight to the strike at Escondida mine in Chile. The union has lowered its demands yet again, but BHP Billiton has not moved to raise its previous offer, which workers have rejected.

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