WASHINGTON (dpa-AFX) - Oil prices fell on Wednesday to extend losses from the previous session after industry data showed U.S. crude inventories unexpectedly increased last week.
The downside also reflected caution ahead of a Federal Reserve meeting that's expected to see further monetary tightening to combat rising U.S. inflation.
Benchmark Brent crude futures fell around 1 percent to $119.96 per barrel, while WTI crude futures were down 1.2 percent at $117.47.
The American Petroleum Institute (API) on Tuesday reported a build of 736,000 barrels last week, while analysts predicted a draw of 1.2 million barrel.
Gasoline stockpiles still fell by 2.2 million barrels last week, suggesting demand from American drivers remained strong despite the record prices.
The official data from the U.S. Energy Information Administration will be out later in the session.
Investors were also reacting to reports of a likely proposal to impose a federal surtax on certain oil companies to curb rising inflation.
U.S. President Biden has accused the U.S. oil industry of keeping gas prices artificially high by not drilling enough.
The Federal Reserve delivers its interest-rate decision later today and the consensus is that the FOMC will raise its key Fed Funds rate by 50 bps later in the day. A move of 75 basis points would be a surprise, given the deteriorating outlook for growth around the world.
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