NEW YORK (AP) — Oil prices dropped Tuesday along with stocks and other commodities after the Bank of Japan's decision not to undertake additional stimulus measures.
OPEC added extra pressure on oil prices when it disclosed that its members boosted production by 106,000 barrels a day in May, adding more oil to a well-supplied market.
Benchmark oil for July delivery fell $1.09, or 1.1 percent, to $94.68 per barrel in morning trading on the New York Mercantile Exchange.
The Bank of Japan decided to stick to its current bond-buying program Tuesday, disappointing some who were looking for new measures to help the world's third-largest economy.
Addison Armstrong, senior director of market research at Tradition Energy in Washington, said the BOJ's decision increased concerns "that global central banks will soon begin to pull back on stimulus measures."
Investors have been trying to guess the timetable for the U.S. Federal Reserve to wind down its massive bond-buying program. The $85 billion-a-month asset purchases, which help put pressure on interest rates, have been a boon to stock and commodities markets, where investors have turned in search of returns that outdo bonds.
In the U.S., the Dow Jones industrial average was down 73 points, 0.5 percent, to 15,166 at midday. Most markets in Europe fell more than 1 percent. Japan stocks lost 1.5 percent.
OPEC raised concerns about the market being over-supplied when it said in its report that Saudi Arabia, the world's biggest oil exporter, raised production by 143,400 barrels a day last month to 9.4 million barrels a day. But OPEC kept its forecast for global oil demand to increase by 800,000 barrels per day in 2013.
Traders later in the day will look to the U.S. Energy Department's own monthly report, while the International Energy Agency, an umbrella group for the world's oil consuming nations, gives its update Wednesday. The Energy Department issues its weekly report on oil and fuel supplies on Wednesday.
Elsewhere Brent crude, a benchmark for many international oil varieties, fell $1.78, or 1.7 percent, to $102.17 a barrel on the ICE Futures exchange in London.
In other energy futures trading on the Nymex:
— Wholesale gasoline fell 4 cents to $2.80 a gallon.
— Heating oil fell 3 cents to $2.85 per gallon.
— Natural gas slipped 3 cents to $3.77 per 1,000 cubic feet.