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West Texas Intermediate and Brent crudes fell on speculation that U.S. refinery demand will decline as units are idled for maintenance and as the euro tumbled against the dollar.
Government data today will probably show U.S. refineries cut utilization rates by 0.4 percentage point last week, according to a Bloomberg survey of analysts. Refiners schedule maintenance for September and October as they transition to winter from summer fuels. The European Central Bank unexpectedly cut interest rates and announced a bond-buying program in an effort to bolster growth.
"WTI is coming under increased selling pressure as refiners prepare for fall maintenance, which will reduce crude demand," said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut.
WTI for October delivery dropped $1.03, or 1.1 percent, to $94.51 a barrel at 9:01 a.m. on the New York Mercantile Exchange. Futures settled at $92.88 on Sept. 2, the lowest settlement since Jan. 14. The volume of all futures traded was 33 percent above the 100-day average for this time of day. Prices have decreased 4 percent this year.
Brent for October settlement slipped 44 cents, or 0.4 percent, to $102.33 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $7.82 to WTI, up from $7.23 yesterday.
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