The price of oil slipped to near $93 a barrel Wednesday as investors awaited confirmation of another drop in U.S. crude supplies and kept an eye on supply disruptions.
By early afternoon in Europe, benchmark crude was down 46 cents to $93.21 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.47 on Tuesday to settle at $93.67 in New York.
In London, Brent crude was down 56 cents at $111.44 on the ICE Futures exchange.
Over the past two months, crude has rallied 21 percent from below $78 despite signs of weak economic growth and no official confirmation of another round of major monetary stimulus by the U.S. or Europe. Investor optimism has sparked a global stock market rally this week, which has helped carry crude prices higher.
The surge in crude has also been fed this week by supply disruptions after a fire at a Chevron refinery in California and pipeline explosions in Turkey that were carrying crude from Iraq.
"This week's price advance has easily exceeded our expectations and would appear to have some legs for further gains," energy trader and consultant Ritterbusch and Associates said in a report. "Supply disruptions are always difficult to predict but we will also suggest that the pop in risk appetite in recent days has exceeded our expectations given limited hard news regarding central bank stimulus."
The rally took a breather on Wednesday, as global stock markets edged down, weighing on commodities as well.
Investors will look ahead to the latest U.S. supply data, which has recently suggested demand may be improving. The American Petroleum Institute said crude inventories plunged 5.4 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., had predicted a drop of 300,000 barrels.
"The inventory reduction came about despite higher imports and lower refinery activity," said analysts at Commerzbank in Frankfurt. "It therefore remains to be seen whether the official data from the U.S. Department of Energy will paint a similar picture."
The report from the Energy Department's Energy Information Administration — the market benchmark — will be out later Wednesday.
In other Nymex energy trading, wholesale gasoline futures were down 1.40 cents at $2.9773 a gallon and heating oil slid 1.41 cents to $2.9839. Natural gas was up 1.2 cents at $2.976 per 1,000 cubic feet.
Alex Kennedy in Singapore contributed to this report.