Oil dropped for the first time in four days after the U.S. Energy Department said inventories climbed the most in 20 months and as Western nations considered releasing crude from strategic reserves.

Futures declined as much as 2.5 percent after the department said supplies gained 7.1 million barrels to 353.4 million last week, the largest increase since July 2010. French Industry Minister Eric Besson said the U.S. proposed releasing oil from strategic reserves, and a White House official said no decision has been made.

Crude oil for May delivery fell to $104.67 a barrel on the New York Mercantile Exchange. Oil traded at $105.30 before release of the inventory report. The price is up 6.3 percent this year.

Brent oil for May settlement dropped $1.63, or 1.3 percent, to $123.91 a barrel on the London-based ICE Futures Europe exchange. The European benchmark contract’s premium to West Texas Intermediate crude traded in New York was at $18.86, up from $18.21 yesterday. Brent is up 15 percent in 2012.

Gold prices steadily decreased after the mixed statistical data to the U.S. dollar increased up against the world currencies. Thus, the volume of orders for durable goods in the U.S. in February rose 2.2% compared with January, when the decline rate was fixed at 3.6%. The analysts predicted that the rate increase in the reporting month is 3%.

Earlier, gold became cheaper against the background of the Italian Prime Minister Mario Monti about the imminent completion of the European debt crisis, as well as concerns about the lack of economies of neighboring Spain.

During a press conference in Tokyo Monti said he was convinced that the structural reforms undertaken by the Spanish authorities, significantly reduced the risk of a critical situation in the economy. In addition, the Italian leader said that his country's citizens are sensitive to the fiscal consolidation measures and the average budget deficit in the EU is lower than in the U.S., UK or Japan.

At the same time a significant reduction in precious metal quotes prevents disappointed investors publish a final assessment of UK GDP for the fourth quarter of last year. According to revised data, the economy shrunk by 0.3% compared with the third quarter, while the earlier decline was estimated at 0.2%.

Recall recently in the Indian jewelry companies for the first time in seven years, went on strike to oppose the increase of customs duties on precious metals, which can lead to a sharp weakening of the industry.

April futures price of gold on COMEX has fallen today to $ 1667.7 an ounce.

Change % Change Last

Oil $106.93 -0.40 -0.37%

Gold $1,680.40 -4.50 -0.27%