Oil fell below $70 a barrel after a sudden drop in the US business activity and as companies cut more jobs than estimated. Prices rallied 5.9% yesterday after the Energy Department posted a surprise drawdown in gasoline stockpiles.
US gasoline inventories dropped 1.7 million barrels to 211.5 million in the week to September 25, 2009 the Energy Department said. Stockpiles were forecast to rise one million barrels, according to the median of estimates in a Bloomberg News survey of analysts.
Crude oil supplies rose 2.8 million barrels to 338.4 million, the report showed. Distillate stockpiles, which include heating oil and diesel, climbed 323,000 barrels to 171.1 million.
Equities Decline
US stock markets declined following the Chicago business activity report. The Standard & Poor’s 500 Index lost 0.3% to 1,057.08 in New York, while the Dow Jones Industrial Average fell 0.3% to 9,712.28.
Asian shares mirrored the decline on concern the region’s economic recovery may falter. The MSCI Asia Pacific Index lost 1.1% to 116.72 at 12:32 p.m. in Tokyo.
China’s manufacturing expanded in September 2009 at the fastest pace in 17 months on stimulus spending and this year’s record growth in new loans.
Brent crude oil for November 2009 settlement dropped as much as 64 cents, or 0.9%, to $68.43 a barrel on the London-based ICE Futures Europe exchange. The contract traded at $68.51 a barrel at 12:25 p.m. Singapore time. Yesterday, it rose 5.5% to settle at $69.07 a barrel.
