• News
  • Finance

WTI Crude Drops to Lowest Level in a Month as U.S. Supplies Rise

March 12 (Bloomberg) -- West Texas Intermediate crude fell to a one-month low as an Energy Information Administration report showed U.S. supplies rose three times as much as expected and refineries operated at the lowest rate in four months.

Prices fell for a third day. Crude stockpiles expanded by 6.18 million barrels last week, the EIA, the Energy Department’s statistical arm, said. Analysts surveyed by Bloomberg forecast a gain of 2 million. Refinery utilization slipped 1.4 percentage points to 86 percent of capacity. Brent’s premium over WTI grew to more than $9 a barrel.

“The market is under pressure,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “Inventories are likely to continue to build.”

WTI for April delivery declined $1.23, or 1.2 percent, to $98.80 a barrel at 10:41 a.m. on the New York Mercantile Exchange after falling to $98.15, the lowest intraday level since Feb. 7. The volume of all futures traded was more than double the 100-day average.

Brent for April settlement decreased 41 cents, or 0.4 percent, to $108.14 a barrel on the London-based ICE Futures Europe exchange. Volume was 41 percent above the 100-day average. The European benchmark crude was at a premium of $9.34 to WTI, up from $8.52 yesterday.

U.S. crude stockpiles increased to 370 million barrels, the highest level since Dec. 13, the EIA said. Supplies at Cushing, Oklahoma, the delivery point for WTI futures, fell 1.34 million barrels to 30.8 million, the lowest level in two years, the EIA said.

Gasoline stockpiles tumbled 5.23 million barrels to 223.8 million, and distillate fuel, including diesel and heating oil, decreased 533,000 barrels to 113.9 million. Analysts had expected a drop of 2 million barrels in gasoline and a decrease of 450,000 in distillate.

Libyan Instability

Brent’s losses were curbed amid instability in Libya, holder of Africa’s biggest reserves. Ali Zaidan was ousted as Libya’s prime minister by lawmakers yesterday in the culmination of a campaign by Islamists and other opponents to terminate his 17 months in office.

The country is pumping 441,000 barrels a day of crude today, Mohamed Elharari, a spokesman for the state-run National Oil Corp., said by phone from Tripoli. That’s up from 392,000 yesterday. Libya produced an average 350,000 in February and 1.4 million in March 2013, according to data compiled by Bloomberg.

Total crude output from the Organization of Petroleum Exporting Countries increased by 258,600 barrels a day last month to 30.1 million, the highest level since August, as Iraq compensated for reductions in Libya and Saudi Arabia, the group said in its monthly oil market report today. OPEC production is in line with its current collective target of 30 million.

User Response
0 UserComments