Oil fell after the biggest gain in six weeks as a forecast for rising supplies in the U.S. signaled demand may be easing in the world’s biggest crude consumer.
Futures slid as much as 0.8 percent in New York. U.S. crude stockpiles probably rose for a second week, to the highest level since August, according to a Bloomberg News survey before an Energy Department report tomorrow. Prices advanced yesterday after U.S. manufacturing in March expanded at a faster pace than estimated. Oil has climbed this year on concern that tension with Iran will disrupt global supplies.
“There’s no immediate shortage of supplies,” said Andrey Kryuchenkov, an analyst at VTB Capital in London, who predicts U.S. oil will struggle to rally beyond $107 a barrel. “Today there’s small-scale profit-taking after last night’s rally. The upside is also limited on demand concerns.”
Oil for May delivery dropped as much as 81 cents to $104.42 a barrel in electronic trading on the New York Mercantile Exchange and was at $104.56 at 10:40 a.m. London time. It climbed 2.2 percent yesterday, the most since Feb. 21, to $105.23. Prices are 5.8 percent higher this year.