The price of oil remained near $106 a barrel Wednesday as investors awaited a report on U.S. crude inventories and the Federal Reserve chairman's congressional testimony.
By early afternoon in Europe, benchmark crude for August delivery was down 3 cents at $105.97 in electronic trading on the New York Mercantile Exchange. The contract fell 32 cents to finish Tuesday at $106 a barrel.
This week's direction in oil futures could be determined by fresh information on U.S. stockpiles.
Analysts cited data released late Tuesday by the American Petroleum Institute as being in line with expectations regarding crude stocks but showing an unexpected rise in gasoline figures. The report from the Energy Department's Energy Information Administration — the market benchmark — will be out later Wednesday.
"The API reported a surprising increase in U.S. gasoline stocks by 2.6 million barrels for last week. This outweighed the renewed 2.6 million barrel decline in crude oil stocks and the 880,000 barrel reduction in Cushing stocks," said a report from Commerzbank in Frankfurt. "If the inventory data of the U.S. Department of Energy were also to show an increase in gasoline stocks and a cooling of demand, oil prices would probably fall even further."
A survey of analysts by Platts, the energy information arm of McGraw-Hill Cos., expects data for the week ending July 12 to show a decline of 2.5 million barrels in crude oil stocks and no change in gasoline stocks.
Markets are also looking to Ben Bernanke's remarks to Congress for any new insight into when the Federal Reserve will start scaling back its monthly purchases of bonds and other assets that are aimed at keeping interest rates low and encouraging an economic recovery.
The withdrawal of that stimulus could push the dollar higher as U.S. interest rates would tend to rise. That in turn might weigh on the oil price since the commodity is traded in dollars.
In London, Brent crude was down 13 cents to $108.01 a barrel on the ICE Futures exchange.
In other energy futures trading on Nymex:
— Wholesale gasoline fell 2.55 cents to $3.0275 per gallon.
— Heating oil shed 0.5 cent to $3.0414 a gallon.
— Natural gas dropped 0.4 cent to $3.673 per 1,000 cubic feet.