Surge in Crude Oil Inventories Cuts Into Prices

U.S. crude oil inventories ballooned by more than 7 million barrels last week to hit their highest level in more than a year and a half, the American Petroleum Institute said. Crude oil inventories rose by 7.3 million barrels to 315.2 million in the week ended April 13, swelled by another week of strong imports, the industry group said in its weekly supply report. The gains pushed crude inventories--languishing at 25-year lows barely a month ago--to their highest level since late August 1999 after rising 40 million barrels, nearly 15%, in five weeks of straight increases. Backed up by a lower-than-expected draw in gasoline inventories and a rebound in refinery runs, the report sent crude prices on the New York Mercantile Exchange tumbling by more than 40 cents to $27.81 a barrel in after-hours trading. “This number is going to cap the crude market for some time to come,” said Jim Ritterbusch, president of Ritterbusch & Associates in Illinois. “It looked like we might try to run crude up to $29 a barrel, but that’s now off the cards,” he said. Crude had fallen 55 cents in regular trading.