Futures in New York fell as much as 1.3 percent after the data showed a surprise gain in nationwide crude inventories and record-high production, while robust fuel demand depleted gasoline stockpiles by the most since May. Meanwhile, an OPEC committee meeting provided little insight on how output quotas will be split between the group. The Energy Information Administration reported that U.S. crude inventories rose by 5.84 million barrels last week, confounding most analysts in a Bloomberg survey who forecast a decline. Oil production reached a record 11 million barrels a day. Along with falling refinery-utilization rates, a drop in crude exports to the lowest since April also contributed to the inventory build. Click Read More below for additional information.
National Average Price for Regular Unleaded – Current: $2.283; Month Ago: $2.232; Year Ago: $2.596. National Average Price for Diesel – Current: $2.923; Month Ago: $2.953; Year Ago: $2.998.
Crude prices continued gaining on Thursday driven by the unexpected drop in US inventories and supply shortfalls in Canada and Nigeria. North Sea benchmark Brent was trading at $48.01 a barrel, its highest price since November. US West Texas Intermediate (WTI) reached a six-month high of $46.64 per barrel. Data from the US Energy Information Administration (EIA) showed that crude inventories fell 3.4 million barrels in the week ending May 6, below analysts’ expectations. Gasoline and distillate inventories also declined. According to EIA, crude output fell to 8.8 million barrels a day last week which is the lowest level since September 2014.
A rebound in oil prices this year from 12-year lows is in danger of coming to a crashing halt, as the main engine of global demand growth for the past several years starts to sputter amid signs of a gasoline glut. Crude oil has rallied more two-thirds from its mid-January nadir on robust demand from refineries worldwide, stoking cautious optimism among producers and exporters that the epic rout that slashed global prices by 75 percent between mid-2014 and early 2016 is finally over. But rampant production of oil products, especially in Asia, is threatening to derail that recovery. Several major gasoline importing countries have started to export, as excess supplies of fuels overflow storage facilities and erode refinery profits. "Asia has overcapacity in refining, so that's ruining margins," said Oystein Berentsen, managing director for crude at oil trading firm Strong Petroleum in Singapore.