NEW YORK (CNNMoney.com) -- Oil fell for the first time this week as the dollar gained strength following the Federal Reserve's decision to raise its discount rate.
What prices are doing: Crude oil for March delivery fell 87 cents, or 1%, to $78.19 a barrel on Friday.
On Thursday, oil rose to the highest level in five weeks after an inventory report showed a larger-than-expected inventory drop. Prices have climbed 1.5% this week.
What's driving prices: The dollar gained versus major currencies Friday after the Federal Reserve raised the discount rate by a quarter percentage point to 0.75% Thursday afternoon.
The Consumer Price Index, the government's key inflation reading, is due at 8:30 a.m. ET. Economists surveyed by Briefing.com expect an increase of 0.3% in January, compared to an increase of 0.1% in December.
In its weekly inventory report Thursday, the U.S. Energy Information Administration said the nation's supplies rose by 3.1 million last week.
Crude supplies were forecast to rise by 1.65 million barrels, according to a survey conducted by research firm Platts.
The EIA also said supplies of gasoline rose by 1.7 million barrels and distillates decreased by 2.9 million barrels.
Analysts had forecast a 1.5 million barrel gain in gasoline stockpiles and a 1.6 million barrel drop in distillates, used to make heating oil and diesel.
Gas prices: The national average price for a gallon of regular unleaded gasoline rose to $2.623, up 0.9 cents from the previous day's price of $2.614, according to motorist group AAA.
