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Crude falls as U.S. stockpiles rise more than expected

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Investing.com - Oil prices dropped in afternoon U.S. trading on Wednesday after official data revealed that U.S. inventories posted hefty increases last week, disappointing investors hoping for modest gains.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in April traded at USD89.71 a barrel on Wednesday, down 1.22% and off from a session high of USD91.17 and up from an earlier session low of USD89.57.

U.S. supply data served as the commodity's chief steering current on Wednesday, prompting a selloff despite otherwise bullish data from the U.S. labor market.

The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories rose by 3.8 million barrels in the week ended March 1, well beyond market calls for an increase of 526,000 barrels.

Total U.S. crude oil inventories stood at 381.4 million barrels as of last week, well above the upper limit of the average range for this time of year.

Total motor gasoline inventories, meanwhile, decreased by 616,000 barrels compared to expectations for a decline of 700,000 million barrels.

Oil prices dropped despite payroll processor ADP's report that private-sector, non-farm payrolls rose by 198,000 in February, beating expectations for an increase of 170,000.

January's figure was revised up to a gain of 215,000 from a previously reported increase of 192,000.

Elsewhere, the U.S. Census Bureau reported that factory orders fell by 2% in January, less than market calls for a drop of 2.2%.

Elsewhere on the ICE Futures Exchange, Brent oil futures for April delivery were down 0.95% at USD110.55 a barrel, up USD20.84 from its U.S. counterpart.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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