Crude oil futures slipped below $80 a barrel on Wednesday after the weekly government report showed a bigger than expected in crude and distillate stockpiles.

The Energy Information Administration said crude oil supplies rose by 3.7m barrels in the week ended 8 January. Analysts has pencilled in an increase of 1.9m barrels.

Gasoline supplies rose 3.8m, much bigger than forecasts of 1.6m barrels. Meanwhile distillates, which make diesel and heating oil, rose by 1.4m barrels, confounding expectations of a decline of 1.7m barrels.

The robust data put pressure on crude oil for February delivery, which fell $1.14 to settle at $79.65 a barrel. It dropped to an intra-day low of $78.39.

Comex gold for February delivery finished up $7.40 at $1,136.80 an ounce in New York. The yellow metal firmed as the dollar drifted lower. The Federal Reserve's snapshot of the US economy, known as the Beige Book, said conditions continued to improve modestly at the end of 2009.

Traders will be looking out for Thursday's retail sales report from the US Department of Commerce.

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