Oil prices fall on questions about global economy
The price of oil was in a holding pattern Wednesday as traders questioned the potential benefit of efforts to promote economic growth in the U.S. and Europe.
Benchmark oil fell 16 cents Wednesday to end at $97.01 per barrel in New York. Brent crude, which is used to price international varieties of oil, gained 56 cents to $115.33 per barrel in London.
A German court cleared a path for Europe to create a fund to help financially troubled countries. It is just one of several strategies being pursued to resolve Europe's debt crisis.
Oil prices briefly topped $98 per barrel after the ruling was announced. Those gains were erased after the U.S. government said crude inventories increased last week.
Now, traders are looking ahead to Thursday when the Federal Reserve wraps up a two-day policy meeting. There is broad speculation that Chairman Ben Bernanke will unveil a bond-buying program or other steps designed to boost the U.S. economy.
Since hitting a low of $77.69 per barrel in late June, oil has risen about $20 per barrel on expectations that the U.S., Europe and China will do more to help their economies.
But the price has stayed in a narrow range recently. That's because traders aren't convinced yet that stimulus measures announced in Europe or those expected in the U.S. will be enough to bolster the global economy, Tradition Energy oil analyst Gene McGillian said.
"The market is starting to signal that unless we see something verifiable that the global economy is improving, further advances are going to be kind of tough to come by," he said.
At the pump, the national average price for gasoline rose 1.5 cents overnight to $3.858 per gallon, according to AAA, Wright Express and the Oil Price Information Service. That's about 16 cents more than a month ago.
In other trading on the New York Mercantile Exchange:
— Heating oil rose 2.95 cents to finish at $3.2152 per gallon.
— Wholesale gasoline fell 4.19 cents to finish at $3.0016 per gallon.
— Natural gas rose 7.1 cents end at $3.063 per 1,000 cubic feet.