Oil prices drop as fuel supplies climb

Oil prices fell Wednesday as the government report showed bigger-than-expected increases in gasoline supplies of the United States. Energy Information Administration (EIA), the U.S. Energy Department's statistical arm, on Wednesday released a report covering the country's crude supplies of the week ending Jan. 4. Crude stockpiles decreased 2.68 million barrels to 357.9 million barrels, the lowest level since Sept. 13, while gasoline inventories rose 6.24 million barrels to 227 million last week, the highest level since March. Trader regarded the report "bearish" as weak demand for fuel put a lot of pressure on the oil market. U.S. Federal Reserve released minutes from its December policy meeting on Wednesday afternoon. Following that meeting, the U.S. central bank announced the first tapering of its massive asset purchases by 10 billion U.S. dollars starting January. The minutes showed the bond-buying reduction was backed by most officials. The so-called tapering of the Fed would likely boost the greenback, making dollar-priced oil more expensive for countries using other currencies, dampening the demand for oil. Light, sweet crude for February delivery moved down 1.34 dollars to settle at 92.33 U.S. dollars a barrel on the New York Mercantile Exchange, while Brent crude for February delivery lost 20 cents to close at 107.15 dollars a barrel.