Another factor: the government reported a smaller than expected decline in oil supplies and a rise in gasoline inventories.
Benchmark crude for September delivery dropped 93 cents to close at $104.37 a barrel on the New York Mercantile Exchange. Oil has fallen $2.57 so far this week.
This past week, a number of Federal Reserve officials have indicated that the central bank may be close to reducing a bond-buying program that has kept long-term interest rates low. Those low rates have helped boost investment in riskier assets like stocks and oil.
The U.S. government's Energy Information Agency said Wednesday that crude oil supplies fell 1.3 million barrels last week. Analysts were expecting a drop of 2 million barrels, according to Platts, the energy information arm of McGraw-Hill. In addition, gasoline supplies rose by 100,000 barrels, while analysts had forecast a 1 million barrel decline.
At the pump, the average price of a gallon of gasoline fell 1 cent to $3.60. That's down 3 cents over the past week.
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