Brent crude dropped

Brent crude dropped after Germany’s industrial production fell, boosting concern about Europe’s largest economy. The North Sea oil’s premium over West Texas Intermediate narrowed for a fourth time in five days.

Futures declined as much as 1 percent in London after data from Germany showed that output decreased 1.2 percent in October after a 0.7 percent drop the previous month, the Economy Ministry in Berlin said today. The spread between Brent and WTI has narrowed by more than $4 in a week as U.S. crude inventories declined and TransCanada Corp. (TRP) said it expected to move oil to Houston on the Keystone XL pipeline in January.

The European benchmark traded at a $12.99 premium to WTI, heading for the narrowest close since Nov. 19. The spread narrowed to $12.86 in intraday trading.

U.S. crude supplies fell 5.59 million barrels to 385.8 million in the week ended Nov. 28, the Energy Information Administration, the Energy Department’s statistical arm, said Dec. 4. Refineries operated at 92.4 percent of capacity, the most since September. Utilization rates usually pick up in December after maintenance is performed during the lull in fuel use between the summer driving and the winter heating periods.

WTI is heading for its seventh straight gain, which would be the longest stretch of increases since July 2012. Prices surged 5.3 percent last week on TransCanada Corp. plans to start part of its Keystone XL pipeline to the Gulf Coast from Cushing, Oklahoma. The Calgary-based company estimates it will begin taking receipts and delivering oil in mid- to late January, a bulletin shows. The link ending at Port Arthur, Texas, will have a capacity of 700,000 barrels a day.

Brent crude for January settlement decreased 81 cents, or 0.7 percent, to $110.80 a barrel at 9:09 a.m. New York time on the London-based ICE Futures Europe exchange. The volume of all futures traded was 9.4 percent below the 100-day average

WTI for January delivery rose 16 cents to $97.81 a barrel on the New York Mercantile Exchange. Volume was 44 percent lower than average. Futures climbed 27 cents to $97.65 on Dec. 6, the highest close since Oct. 29.