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The oil price backtracked on Wednesday after the US Energy Information Administration (EIA) released its weekly data on US oil inventories.

Having traded almost as high as $72 a barrel prior to the EIA report the price of the August future contract, perversely, fell back after EIA figures showed stockpiles declined by a larger than expected 3.7m barrels last week to 350.2m barrels. Market expectations had been for a fall of 2m barrels, though the American Petroleum Institute had projected a much larger decline of 5.9m barrels.

It was the fourth week in a row that stockpiles of crude oil had fallen, though inventories are still almost one-fifth higher than they were a year ago. Traders sold off oil, taking note of the increase in gasoline inventories, which rose by 2.3m barrels to 211.2m barrels. The week before the 4th of July Independence Day holiday normally sees an increase in petrol consumption but this year American drivers appear to be leaving the car in the garage more often.

Distillate fuel inventories rose by 2.9m barrels to 155m barrels, versus expectations of a 1.5m barrel increase.

At the close of trading in New York the August future contract for light sweet crude had fallen 58 cents to $69.31.

Gold returned to favour after falling back on Monday and Tuesday. The August gold contract rose $13.90 to $941.30 an ounce on the Comex division of the New York Mercantile Exchange as the US dollar headed lower on expectations of dismal non-farm payrolls data tomorrow. Payroll processing firm ADP released its June jobless survey, which showed US companies shed 473,000 jobs in June, against economists' expectations of a loss of around 400,000 jobs.

Economists are predicting that Thursday's official non-farm payrolls data will show a rise in unemployment numbers of around 325,000 for June, with the unemployment rate expected to hit 9.6%.

Prices of silver, platinum, palladium and copper also advanced as a modicum of optimism about the global economy returned.