The price of oil regained some of its earlier losses on Wednesday after a report from the Federal Reserve showed the economy strengthened across much of the country.
Benchmark oil for April delivery fell 39 cents to finish at $90.43 a barrel on the New York Mercantile Exchange. It had dropped as low $89.55 after the government reported a big increase in the nation's stockpile of oil.
But crude clawed back some ground when the Fed's Beige Book report showed that auto sales, more hiring and the ongoing housing recovery helped the U.S. economy grow in January and February
Earlier the Energy Department's Energy Information Administration said in its weekly report that U.S. oil supplies grew last week by 3.8 million barrels, or 0.4 percent, more than three times the increase that analysts expected. The nation's supply of crude is 10.3 percent above year-ago levels. And at more than 7 million barrels a day, U.S. oil production is at the highest level since the late 1990s.
Falling oil prices have spelled some relief for U.S. drivers. The average price of a gallon of gas fell for a seventh straight day, to $3.73 a gallon. That's still up 21 cents from a month ago, but down 3 cents from this time last year.
The death of Venezuela President Hugo Chavez had little immediate effect on the price of oil. The full impact of his death may not be felt until Venezuela, which sits on the world's second-largest oil reserves, picks a new leader — one who might choose a course different from Chavez. Elections are expected to be called within a month.
Chavez, who died Tuesday after a two-year battle with cancer, oversaw a decline in oil production during his 14 years as the leader of Venezuela. In the short-term, traders will watch for any disruption to Venezuela's production. Longer term, they'll want to see if the new government invites foreign investment in Venezuela's oil industry and is able to boost output.
Brent crude, used to price many kinds of oil imported by U.S. refineries, fell 55 cents to end at $111.06 a barrel on the ICE Futures exchange in London.
In other energy futures trading on the Nymex:
— Wholesale gasoline dropped 2 cents to finish at $3.12 a gallon.
— Heating oil rose less than a cent to end at $2.98 a gallon.
— Natural gas lost 6 cents to finish at $3.47 per 1,000 cubic feet.
Martin Crutsinger in Washington, Pamela Sampson in Bangkok and Pablo Gorondi in Budapest contributed to this report.