Inventory Rise Pushes Down Price of Crude

Oil futures prices slid almost 5% on Wednesday as U.S. crude oil supplies grew on the third-highest weekly import level on record.

U.S. light crude dropped $2.59, the largest price drop since Dec. 27, to $51.61 a barrel, the lowest close since April 18 and 11% below the all-time intraday trading high of $58.28 struck this month on the New York Mercantile Exchange.

Gasoline futures plunged 8.32 cents to $1.54 a gallon, while heating oil futures fell 3.39 cents to $1.47 a gallon.

Prices plunged after the Energy Information Administration said U.S. crude stocks rose 5.5 million barrels last week to 324.4 million, the 10th increase in the last 11 weeks.

Crude imports poured in at 10.9 million barrels a day, pushing U.S. commercial crude stocks to their highest level since May 2002.

“If you ramp up crude imports to this degree ... you’re going to get a crude build, it’s pretty straightforward. The build is unambiguously bearish, there are no ifs, ands, or buts about it,” said Jan Stuart, analyst at Fimat USA bank.

The boost in crude supplies outweighed the effect of a small decline in gasoline stocks and a surprise drop in distillate inventories, including diesel fuel, as refineries struggled to keep up with continued demand growth.

Tom Bentz, a broker at BNP Paribas Futures in New York, attributed the sell-off to shifting sentiment among traders about the U.S. supply of gasoline ahead of the summer. Last week, concerns about refinery glitches put upward pressure on the entire oil complex.