Oil falls for fourth day

4 October 2007

The price of oil fell for a fourth consecutive day on Wednesday after a US government report revealed a rise in the country's stock of crude oil.

Many analysts had expected the Energy Information Administration's weekly update to show the stockpile had dwindled, but it actually revealed a 1.2 million barrel increase.

The market's reaction saw US crude for November delivery lose 11 cents to finish at $79.94 (£39.41) a barrel, while London Brent crude dropped 19 cents to $77.19.

However, as the stockpile of crude oil in the US is 6.3 million barrels smaller than 12 months ago, Michael Davies of commodities brokers Sucden believes the fall in price is just a reaction to recent trading conditions.

"Overall, [supply and demand] fundamentals remain tight, but the profit taking we had in the last sessions had to be expected, after such a strong bull run recently," Mr Davies told AFP.