West Texas Intermediate crude dropped for a second day as the Bank of Japan unexpectedly left a lending program unchanged, bolstering concern that central banks are growing reluctant to add more stimulus.

Prices slumped as much as 1.8 percent, tumbling with commodities and equities, after BOJ Governor Haruhiko Kuroda and his fellow board members refrained from expanding their tools to address bond-market volatility. They stuck with an April plan to double the monetary base as they seek to rekindle inflation and stoke growth. U.S., European and Asia stocks declined.

Crude also retreated as U.S. supplies were forecast to remain near the highest level since 1931 amid a 12-year seasonal low in gasoline demand.

U.S. crude stockpiles reached 397.6 million barrels on May 24, the most in 82 years, according to Energy Information Administration data. They probably dropped 1.5 million barrels last week to 389.8 million, according to analysts surveyed before an EIA report tomorrow.

Gasoline consumption averaged 8.73 million barrels a day in the four weeks ended May 31, down 0.8 percent from a year earlier.

WTI for July delivery fell 82 cents, or 0.9 percent, to $94.95 a barrel at 11:20 a.m. on the New York Mercantile Exchange. The volume of all futures traded was 4 percent below the 100-day average for the time of day.

Brent for July settlement dropped $1.47, or 1.4 percent, to $102.48 a barrel on the London-based ICE Futures Europe exchange. Volume was 16 percent above the 100-day average for the time of day. Brent’s premium to WTI shrank to as small as $7.46, the narrowest level since May 22 on an intraday basis.

Gold prices decline after ratings agency Standard & Poor's raised the outlook of the U.S. rating to stable, reducing the appeal of gold as a safe asset.

Global financial markets are under pressure after Federal Reserve Chairman Ben Bernanke said in May that the central bank may cut the program of buying bonds at a future meeting when saving features to strengthen the U.S. economy. However, the president of the Federal Reserve Bank of St. Louis James Bullard said on Monday that high inflation allows the Fed to continue buying bonds in full.

The demand in the physical market is reduced from a peak of April, when the spot price fell to a minimum of two years $ 1.321,35. Dealers in Singapore reported decreased deficit gold bars and coins.

Stocks of the world's largest exchange-traded fund backed by gold (ETF) SPDR Gold Trust on Monday, rose 0.3 percent to 1.009,85 tons, but still close to a minimum of four years.

The cost of the August gold futures on COMEX today dropped to 1364.5 dollars per ounce.

EUR/USD $1.3040, $1.3150, $1.3190, $1.3200, $1.3250

USD/JPY Y97.00, Y97.50, Y98.00, Y98.95, Y99.00, Y100.00

GBP/USD $1.5500

USD/CHF Chf0.9410

EUR/CHF Chf1.2300

AUD/USD $0.9450, $0.9500

Change % Change Last

GOLD 1,386.10 3.10 0.22%

OIL (WTI) 95.83 -0.20 -0.21%