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Oil extended losses, falling below $100 a barrel after the U.S. Energy Department reported an unexpected increase in inventories.
Supplies rose 1.34 million barrels to 336.1 million last week, the Energy Department said today.
Crude oil for January delivery fell $1.26, or 1.2 percent, to $100.02 on the New York Mercantile Exchange. The price, which was $101.06, slipped as low as $99.92 after the report. Yesterday, the contract added 29 cents to $101.28, the highest settlement since Nov. 16.
Oil also fell after a German official raised doubts that there will be an agreement at the European summit this week. Futures fell 0.6 percent as Germany rejected proposals to combine the current and permanent euro-area rescue funds and Chancellor Angela Merkel’s government said it was more pessimistic on the meeting’s outcome.
Germany will oppose any attempt to change an agreed sequence in which the permanent European Stability Mechanism will take over from the current rescue fund at an appointed time, a German official told reporters in Berlin today on condition of anonymity because the negotiations are private.
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