The price of oil eased on news that US reserves of gasoline and diesel fuel rose last week.
The US Energy Department revealed that combined gasoline and diesel stockpiles rose by 7.14bn in the week to December 28.
Also acting as a drag on the price of oil was last night’s report from the December meeting of the Federal Open Market Committee.
The minutes indicated some members are becoming increasingly concerned about the risks of more asset purchases.
The Fed looks set to continue an open-ended economic stimulus programme, but some appear to be in favour of putting an end to quantitative easing (QE).
Michael Hewson, Senior Market Analyst at spread betting firm CMC markets, described the FOMC minutes as “unexpectedly hawkish”.
Some analysts suggested an end to the Fed’s bond buying programme would be bad news for oil prices.
Brent crude for February delivery declined US$1.22 to US$110.92 a barrel in London on the ICE Futures exchange.
Meanwhile, in New York, West Texas intermediate for February delivery shed 14 cents to US$92.79 a barrel, albeit on thin volumes.
The February futures contract for gasoline tumbled almost 2% on the release of the Energy Department’s stockpiles report, which showed gasoline inventories rose 2.57mln barrels to 225.7mln barrels in the week to December 28.