Crude Oil Give Back Ground After Two-Day Surge

(RTTNews) - Crude oil futures moved to the downside during trading on Wednesday, giving back ground after moving sharply higher over the two previous sessions.

After surging $2.62 or 4.3 percent to $63.41 a barrel over the first two days of the week, crude for July delivery fell $0.56 or 0 .9 percent to $62.85 a barrel.

The pullback by the price of crude oil partly reflected easing supply concerns as rains slowed the growth of some blazes that had disrupted Canadian crude production.

According to Bloomberg, one Canadian operator restarted a site after shutting down last week.

Disappointing U.S. economic data also weighed on oil prices, with separate reports showing weaker than expected private sector job growth and an unexpected contraction by service sector activity.

The decrease by the price of crude oil also came following the release of the Energy Information Administration's report on weekly oil inventories.

While the report showed a much bigger than expected decline by crude oil inventories, it also showed significant increased by gasoline and distillate fuel inventories.

The EIA said crude oil inventories slid by 4.3 million barrels in the week ended May 30th after falling by 2.8 million barrels in the previous week. Economists had expected crude oil inventories to edge down by 0.9 million barrels.

At 436.1 million barrels, U.S. crude oil inventories are about 7 percent below the five-year average for this time of year, the EIA said.

Meanwhile, the report said gasoline inventories surged by 5.2 million barrels last week but remain about 1 percent below the five-year average for this time of year.

Distillate fuel inventories, which include heating oil and diesel, also shot up by 4.2 million barrels last week but remain about 16 percent below the five-year average for this time of year, the EIA said.