Forexpros – Crude oil futures rallied to a new three-month high Wednesday, after U.S. government data indicated crude oil inventories fell more-than-expected last week.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in September traded at USD93.93 a barrel during U.S. afternoon trade, up 0.29%.

The U.S. Energy Information Administration said U.S. crude oil inventories decreased by 3.7 million barrels in the week ending August 3, more than forecasts for a decline of 0.26 million barrels.

Total gasoline stocks fell by 1.8 million barrels, while distillate stocks, which include heating oil and diesel, decreased by 0.7 million barrels, the EIA said.

The data came after the American Petroleum Institute, an industry group, said U.S. crude stocks fell by 5.35 million barrels last week, far more than the expected decline of 0.54 million barrels.

Crude oil rallied to a three-month high on Tuesday, as gains in European equities markets and concerns over potential supply threats in the Middle East supported prices.

Market sentiment waned on Wednesday, after weaker-than-expected German economic indicated that the effects of the long running debt crisis are continuing to take a toll on the region’s largest economy.

German industrial production fell 0.9% in June, more than forecasts for a decline 0.8%, following an upwardly revised 1.7% gain in May.

Meanwhile, ratings agency Standard and Poor’s revised the outlook for Greece to negative, from stable overnight and warned that Athens was likely to miss the financial targets set by its international lenders, which would increase the likelihood of a default.

However, risk appetite continued to be supported by expectations that the European Central Bank will soon take steps to help lower Spanish and Italian borrowing costs after the bank indicated last week that it may restart its bond buying program.

In the U.S, comments by Boston Federal Reserve President Eric Rosengren on Tuesday kept alive speculation over the possibility for more easing by the U.S. central bank.

Rosengren said the Fed should launch another round of quantitative easing of whatever size and duration was necessary to get the economy back on its feet.

On the London based ICE Futures Exchange, Brent oil futures for September delivery were up 0.71% to trade at USD112.80 a barrel, with the spread between the Brent and crude contracts standing at USD18.65.

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