Oil fell for a third day

West Texas Intermediate crude fell for a third day amid speculation that the Federal Reserve may reduce stimulus and after Bank of America’s Francisco Blanch said it will be difficult for WTI to rally much more.

Prices dropped as much as 1.2 percent as investors awaited an address by Fed Bank of Chicago President Charles Evans for indications of the central bank’s policy. Dallas Fed President Richard Fisher said yesterday the bank is closer to slowing $85 billion in monthly bond buying. WTI could slide $8 to $10, Blanch, head of commodities research at Bank of America in New York, said in an interview with Tom Keene on Bloomberg Radio.

WTI for September delivery decreased $1.09, or 1 percent, to $105.47 a barrel at 10:23 a.m. on the New York Mercantile Exchange. Earlier, it gained as much as 0.7 percent. The volume of all futures traded was 7.2 percent below the 100-day average.

Brent for September settlement slid 94 cents, or 0.9 percent, to $107.76 a barrel on the London-based ICE Futures Europe exchange. Volume was 6.1 percent above 100-day average. The European benchmark grade was at a premium of $2.29 to WTI.

Crude surged 8.8 percent in July, the biggest monthly gain since August 2012, as U.S. inventories dropped and on concern that political instability in Egypt may disrupt exports from the Middle East.