Oil falls slightly even with report of unexpected supply drop

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The price of oil fell slightly Wednesday, despite a report of an unexpected decline in the nation’s supplies.

Benchmark U.S. crude for May delivery slipped 12 cents to close at $99.62 a barrel on the New York Mercantile Exchange.

Brent crude, used to set prices for international varieties of oil, dropped 83 cents to $104.79 a barrel on the ICE Futures exchange in London as traders considered the possible reopening of export terminals in Libya.

The U.S. Energy Department said Wednesday that the nation’s supply of crude oil fell by 2.4 million barrels last week, counter to the expectations of analysts surveyed by Platts, who were looking for an increase of 1.8 million barrels. Still, it was the first decline in 11 weeks and traders might be waiting for further evidence of increased demand for oil.

Meanwhile, the possible reopening of oil export facilities occupied by militias in eastern Libya, until recently an important supplier to European refineries, also weighed the price of Brent, though analysts continued to be cautious.

“The ports in question have a daily export capacity of 600,000 barrels, which would increase Libya’s oil shipments six-fold in one fell swoop,” said analysts at Commerzbank in Frankfurt in a note to clients. They cautioned, however, that similar reports in the past had shown that “any agreement that is reached can in a matter of days turn out to be worth less than the paper it is written on.”

In other energy futures trading in New York:

— Wholesale gasoline was flat at $2.87 a gallon.

— Natural gas rose 9 cents to $4.36 per 1,000 cubic feet.

— Heating oil shed 2 cents to $2.87 a gallon.

(TSX:ECA, TSX:IMO, TSX:SU, TSX:HSE, NYSE:BP, NYSE:COP, NYSE:XOM, NYSE:CVX, TSX:CNQ, TSX:TLM, TSX:COS.UN, TSX:CVE)

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