NEW YORK -- Oil prices were little changed Wednesday though data showed that U.S. crude inventories dropped more than expected last week.
Energy Information Administration (EIA) said Wednesday crude supplies shrank 2.8 million barrels to 360.5 million barrels for the week ending Aug. 9. Analysts expected a drop of 1.5 million barrels.
Gasoline supplies dropped 1.2 million barrels to 222.4 million barrels. The EIA report also showed that U.S. refineries operated at 89.4 percent of their total capacity.
The EIA report should have been supportive for oil prices because the drop is bigger than expected. But the prices for crude futures did not move higher because people were anticipating that the U.S. Federal Reserve may trim the monthly bond purchases at a September meeting and end the program by the middle of 2014.
Investors have been jittering at hawkish remarks from several senior Fed officials recently, who believe the U.S. central bank would start to scale back the pace of its monthly asset purchases as early as September.
On the economic front, the U.S. Producer Price Index (PPI) for finished goods was unchanged in July, after rising 0.8 percent in June and 0.5 percent in May, the Labor Department reported Wednesday. Tame inflation gave investors some relief that the U.S. central bank is likely to continue its ultra-low interest rates.
Light, sweet crude for September delivery rose 2 cents to settle at 106.85 dollars a barrel on the New York Mercantile Exchange.
Brent for September delivery went up 38 cents to close at 110.2 dollars a barrel.
