US crude futures fell over 2 percent to settle below $77 a barrel on Wednesday, extending losses after US government inventory data showed larger-than-expected builds in crude and gasoline stocks. Crude oil inventories rose 2.1 million barrels last week, a weekly report from the US Energy Information Administration showed, raising doubts about economic recovery in the world's top oil consuming nation.
The data also showed that gasoline stocks rose more than expected but distillate supplies fell more than forecast. "Sluggish demand for gasoline and refined products coupled with anaemic demand for crude from refineries, which pushed the utilisation rate below 80 percent, is an indicator of slack in the system," Chris Jarvis, senior analyst at Caprock Risk Management in Hampton Falls, New Hampshire.
NYMEX crude for January delivery settled at $76.60 a barrel, down $1.77. Brent crude settled at $77.88, down $1.47. Oil has rallied from below $33 last December but has held in a narrow band of $70 to $82 over the past two months. Some analysts see little chance prices will push above the range, given ample supplies and little sign of strengthening demand.
Globally, signs of oil demand were mixed. In India, annual oil product sales rose 17.3 percent in October from a year ago, fuelled by economic activity and higher farm sector demand, according to government data. China and India will be responsible for most of the world's oil demand growth in the next two decades, according to an International Energy Agency forecast last month.
However, in Russia there were further signs of rising global oil supplies as the nation's Energy Ministry data showed output hit a post-Soviet record for the fourth straight month, retaining its position as the world's top producer ahead of Saudi Arabia.
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