Commodities: Crude flops as US inventories' buildup surprises traders

US crude oil inventories soared 1.7m barrels in the week to 22 July, data from the US Energy Information Administration showed. The market had instead expected a fall of 2.3m barrels.

"At 521.1m barrels, US crude oil inventories are at historically high levels for this time of year," USEIA said.

In recent sessions a string of energy-sector analysts have raised the spectre of crude tumbling down a demand cliff amid the long-running supply surfeit.

At about 16:04 BST, Nymex-traded West Texas Intermediate (WTI) crude was down 1.91% to $42.10 a barrel, while Intercontinental Exchange-quoted Brent fell 2.38% to $43.80 a barrel.

"Oil has dropped for five days and to its lowest in three months despite weakness in the US dollar following week economic data," said Jasper Lawler, market analyst at CMC Markets.

"The 200-day moving average now appears to be a tractor beam for the WTI contract at $40 per barrel," added Lawler.

Among metals, Comex-listed gold was up 0.45% to $1326.7 an ounce, with Comex-quoted silver ahead 1.74% to $20.03 an ounce and Comex-priced copper, in industrial favourite, falling 1.51% to $219.2 a pound.

"Gold is still trying to engineer a bounce off two-month rising lows at $1317 (an ounce). Close, but no cigar just yet," said Michael van Dulken, head of research at Accendo Markets.

Three-month prices for aluminium, zinc and tin on London Metals Exchange were moderately down, while that for copper stepped ahead.

In agricultural futures, Chicago Board of Trade-priced corn was up 1.18% to $343.5 a bushel, with CBOT-listed wheat ahead 0.72% to $418.0 a bushel. Cocoa gained 0.74% to $2872 a MT.

Intercontinental Exchange-quoted cotton No.2 firmed 0.37% to $74.22 a pound. Live cattle was fetching $112 a pound, down by 0.51%.