Oil fell as U.S. inventories climbed to a 11-month high and Iran’s envoy in Moscow said his country is considering a Russian proposal to halt the expansion of its nuclear program.

Futures dropped as much as 0.4 percent after the Energy Department reported that U.S. supplies rose 3.98 million barrels to 373 million last week as output climbed to a 12-year high. Ambassador Mahmoud-Reza Sajjadi said Iran will maintain its right to produce atomic power.

U.S. crude oil production grew 70,000 barrels to 6.11 million barrels a day last week, the highest level since November 1999, the report showed.

Gasoline inventories dropped 2.24 million barrels to 211.7 million last week, the department said. Supplies of distillate fuel, a category that includes heating oil and diesel, decreased 3.05 million barrels to 125.9 million.

Crude oil for June delivery fell to $103.11 a barrel on the New York Mercantile Exchange after release of the report. Prices are up 4.6 percent this year.

Brent oil for June settlement dropped 2 cents to $118.14 a barrel on the London-based ICE Futures Europe exchange.

The price of gold fluctuates on Wednesday at the macroeconomic data from the UK, and pending the outcome of the meeting of the FOMC.

As reported on Wednesday a national statistics department of Britain, the country's GDP in the first quarter of this year, according to preliminary estimates, has not changed compared to the same period last year and fell by 0.2% compared with the previous quarter. The data were worse than analysts' forecasts, expects GDP growth of 0.3% compared with January-March 2011 and by 0.1% - in the quarter.

On Wednesday completed a two-day meeting of leaders of the U.S. Federal Reserve.The market once again waiting for the regulator of intent to sustain economic growth with additional incentive measures, but experts in the majority do not involve any extraordinary measures.

Physical demand for gold in recent weeks is low, even in India - the world's largest consumer of precious metals - during the holiday Akshaya Tritiya, when traditionally the demand for gold jewelry.

May futures on the COMEX for gold today is kept in the range of $ 1636.7 - $ 1644.0 per ounce.

Change % Change Last

Oil $103.55 0.44 +0.40%

Gold $1,642.20 -1.60 -0.10%