Crude oil halted a two-day rally on Wednesday as oil inventories jumped unexpectedly and the U.S. dollar rebounded against the euro, Xinhua reported.
Light, sweet crude for January delivery gave up 1.77 dollars, or 2.3 percent, to settle at 76.60 dollars a barrel on the New York Mercantile Exchange.
The drop came as the Energy Information Administration (EIA) reported on Wednesday that U.S. oil supplies grew last week, a surprise to most analysts. According to the EIA report, crude stockpiles increased by 2.1 million barrels for the week ended Nov. 27 while gasoline inventories surged by 4.0 million barrels, showing the fuel demand was still slumping even in the Thanksgiving week.
Oil also took a hit on Wednesday from a strengthening in the dollar, dimming crude's appeal as an alternative investment.
In London, Brent Crude for January delivery lost 1.31 dollars to 78.04 dollars a barrel on the ICE Futures exchange.