Oil dives, forecast of mild U.S. winter spurs retreat from multi-year highs | Reuters

Oil dives, forecast of mild U.S. winter spurs retreat from multi-year highs | Reuters

Oil tumbled on Thursday as a forecast for a warm U.S. winter put the brakes on a rally that drove prices to a three-year high above $86 a barrel early in the session on tight supply and a global energy crunch.

Winter weather in much of the United States is expected to be warmer than average, according to a National Oceanic and Atmospheric Administration released Thursday morning.

"The report, indicating drier and warmer conditions across the southern and eastern U.S., is putting pressure on the complex," said Bob Yawger, director of energy futures at Mizuho.

Brent crude fell $1.21 to $84.61, after reaching a session high of $86.10, highest since October 2018. U.S. West Texas Intermediate crude settled down 92 cents to $82.50.

Prices had rallied on Wednesday when the U.S. Energy Information Administration reported tighter crude and fuel inventories, with crude stocks at the Cushing, Oklahoma storage hub falling to a three-year low.