NEW YORK (MarketWatch) -- Crude futures fell Wednesday for the first session in three after an industry group reported surprising increases in petroleum inventories, highlighting that the market remains well-supplied with oil.
The American Petroleum Institute reported late Tuesday that crude-oil inventories rose by 2.89 million barrels during the week ended Nov. 27. Gasoline stocks increased by 3.4 million barrels, and distillate supplies rose by 1.06 million barrels.
Crude oil for January delivery dropped 68 cents, or 0.8%, to $77.69 a barrel in early North American electronic trading. It ended up 1% Monday in floor trading on the New York Mercantile Exchange.
The API data "were rather bearish," said Amrita Sen, an analyst at Barclays Capital, in a note. However, "the level of accuracy of the API statistics has been questionable, with the data often in opposite direction of that of" the Energy Department.
The Energy Department's Energy Information Administration will release its more closely watched data on Wednesday morning. The government and the API use different criteria for measuring petroleum stockpiles.
Analysts polled by Platts estimated a decline of 1.3 million barrels in crude stockpiles and a rise of 900,000 barrels in gasoline inventories last week. They also projected a decline of 450,000 barrels in distillate inventories.
"The API report suggests that there are still surprisingly high levels of U.S. inventories," said analysts at Sucden Financial Research. "This, along with a forecast of mild temperatures in the U.S. for December, could push crude-oil prices in a correction lower."
Also in early energy trading, January gasoline lost 0.9% to $2.0238 a gallon, and January heating oil slid 0.5% to $2.0671 a gallon. January natural gas was almost flat at $4.767 per million British thermal units.
Elsewhere in the commodity markets, gold futures climbed to a record above $1,217 an ounce on Wednesday, buoyed by strong demand from investors amid worries about the U.S. dollar's continued weakness. Read more on gold's gains.
Investment demand for commodities remains strong. Commodity-sector funds took in more than $1 billion for the second week in a row during the week ended Nov. 25, according to data from EPFR Global.
Year to date, flows into this fund group stood at $14.6 billion.
In economic news, private-sector firms in the U.S. eliminated 169,000 jobs in November, according to the ADP employment report released Wednesday.
It was the fewest jobs lost since July 2008. The private sector has shed jobs for 22 consecutive months. Read more about the jobs data.
