Oil fell on Wednesday after results from the weekly inventory report showed U.S. crude oil supplies fell.

The report, released this morning, showed crude oil supplies fell 6.74 million barrels in the week which ended last Friday exceeding specialists' decline forecast.

According to the analysts, the drop on oil supplies is the biggest since December 14. The Energy Information Administration department reported that in the past two months stockpiles declined 31.8 million barrels.

U.S. oil prices settled down 66 cents at $95.67 on the New York Mercantile Exchange. In London, Brent crude for February dropped $1.17 to $94 on the ICE Futures Europe exchange.

Crude oil's price has also risen on worries over militant threats in Nigeria. Militant activity has reduced Nigerian's oil production more than 10 percent since it started back in 2006. Nigeria is the number eight producer of oil in the world.

Specialists say that the rising in crude oil price has also been supported by a surge in the price of gold.

The inventories report delivered in Washington also showed gasoline inventories rose 5.3 million barrels surprising analysts who expected a 1.6 million increase. Inventories of distillate fuel (a category including heating oil and diesel), climbed 1.5 million barrels.