FX.co ★ Oil Snaps Three-day Rally On Surprise Inventory Build

Oil prices fell sharply on Wednesday to snap a three-day rally after industry data showed a surprise build in U.S. crude and gasoline stockpiles.

Benchmark Brent crude futures fell 1.3 percent to $76.40 a barrel while WTI crude futures were down 1.3 percent at $72.73.

Oil prices reversed a more than 2 percent drop earlier to end higher on Tuesday after the White House said it would start buying crude to replenish the emergency reserves after maintenance work later this year.

Also, a report from the Energy Information Administration (EIA) pointed to higher seasonal demand and lower-than-expected output.

Meanwhile, data from the American Petroleum Institute (API) released late Tuesday showed that U.S. crude oil inventories rose by about 3.6 million barrels in the week ended May 5, compared with analysts' estimate for a drawdown of about 917,000 barrels.

Gasoline stocks increased by 400,000 barrels, while distillate stocks posted a 3.95-million-barrel draw.

The ongoing impasse over the U.S. debt ceiling and caution ahead of U.S. consumer price inflation data due out later in the day also kept oil prices under pressure.