An announcement by China's central bank Wednesday contributed to a 24-cent drop in the price of light sweet crude oil on the New York Mercantile Exchange.
The WTI settled at $96.65 a barrel Wednesday after the People's Bank of China announced plans to raise interest rates by one-quarter percent to 6.56 percent effective July 7. The bank's action marks the third such hike this year. Brent, meanwhile, barely ended the day in positive territory. It gained a penny to settle at $113.62 a barrel.
The interest rate hike, coupled with lingering concerns about the debt crises in Greece in Portugal, have stoked fears of softening oil demand among investors. Providing some support for oil were expectations that the U.S. Energy Information Administration and American Petroleum Institute will report lower oil stocks Thursday. A Platts survey of analysts projects that EIA and API inventory data will reveal a 2.5 million-barrel draw.
The August WTI contract peaked at $97.79 and bottomed out at $95.90. Brent fluctuated from $112.17 to $113.82.
Expectations that temperatures will moderate over the next two weeks throughout the Midwest and East Coas chilled the price of natural gas for August delivery Wednesday. The front-month contract lost 14 cents to settle at $4.22 per thousand cubic feet.
Natural gas traded within a range from $4.26 to $4.36.
August gasoline futures ended the day slightly below $3.00 a gallon after fluctuating from $2.94 to $3.00 during the midweek session.
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