Crude oil fell to a seven-month low after an Energy Department report showed an unexpected gain in U.S. inventories as refineries shut units.
Crude oil supplies rose 3.36 million barrels to 328.1 million in the week ended Sept. 29. A decline of 1.1 million barrels was expected, according to the median of 14 responses in a Bloomberg News survey. Refineries operated at 89.9 percent of capacity, the lowest since May. Stockpiles of gasoline and diesel also increased.
``The refinery number is a surprise to everyone,'' said Jason Schenker, an economist with Wachovia Corp. in Charlotte, North Carolina. ``The fall in refinery utilization resulted in rising crude oil inventories. Crude oil went unused because of the increased maintenance.''
Crude oil for November delivery fell 23 cents, or 0.4 percent, to $58.45 a barrel at 10:49 a.m. on the New York Mercantile Exchange. Prices touched $58.20, the lowest since Feb. 16. Futures have declined 25 percent from a record $78.40 a barrel on July 14 as tensions in the Middle East eased and fuel stockpiles increased.
The Energy Department released its weekly report on petroleum inventories at 10:30 a.m. in Washington.
Perform A Background Check On Anyone, Anywhere
``Despite the significant stock builds in the U.S. the underlying picture hasn't changed,'' said Antoine Halff, an energy analyst with Fimat USA in New York. ``The geopolitical risk is still out there and the tightness in spare capacity is still there. I don't think OPEC will take any action unless prices fall lower.''
Crude oil rose earlier after Kuwait said that the Organization of Petroleum Exporting Countries should consider following Venezuela and Nigeria in cutting production if prices decline further.
``If it's for the benefit of the market we will support a cut in production,'' Sheikh Ali-Jarrah al-Sabah said in a telephone interview from Kuwait. ``We are not talking at the moment but that could change by the end of the day,'' he said. The 11-member group, which produces about 40 percent of the world's oil, is scheduled to meet in Nigeria on Dec. 14.
Saudi Arabia, OPEC's largest oil producer, has declined to comment this week on falling oil prices. Nigeria and Venezuela last week said they will cut production by a combined 170,000 barrels a day starting on Oct. 1. The group's President Edmund Daukoru yesterday urged members to follow Nigeria's example.
Crude oil supplies rose 3.36 million barrels to 328.1 million in the week ended Sept. 29. A decline of 1.1 million barrels was expected, according to the median of 14 responses in a Bloomberg News survey. Refineries operated at 89.9 percent of capacity, the lowest since May. Stockpiles of gasoline and diesel also increased.
``The refinery number is a surprise to everyone,'' said Jason Schenker, an economist with Wachovia Corp. in Charlotte, North Carolina. ``The fall in refinery utilization resulted in rising crude oil inventories. Crude oil went unused because of the increased maintenance.''
Crude oil for November delivery fell 23 cents, or 0.4 percent, to $58.45 a barrel at 10:49 a.m. on the New York Mercantile Exchange. Prices touched $58.20, the lowest since Feb. 16. Futures have declined 25 percent from a record $78.40 a barrel on July 14 as tensions in the Middle East eased and fuel stockpiles increased.
The Energy Department released its weekly report on petroleum inventories at 10:30 a.m. in Washington.
Perform A Background Check On Anyone, Anywhere
``Despite the significant stock builds in the U.S. the underlying picture hasn't changed,'' said Antoine Halff, an energy analyst with Fimat USA in New York. ``The geopolitical risk is still out there and the tightness in spare capacity is still there. I don't think OPEC will take any action unless prices fall lower.''
Crude oil rose earlier after Kuwait said that the Organization of Petroleum Exporting Countries should consider following Venezuela and Nigeria in cutting production if prices decline further.
``If it's for the benefit of the market we will support a cut in production,'' Sheikh Ali-Jarrah al-Sabah said in a telephone interview from Kuwait. ``We are not talking at the moment but that could change by the end of the day,'' he said. The 11-member group, which produces about 40 percent of the world's oil, is scheduled to meet in Nigeria on Dec. 14.
Saudi Arabia, OPEC's largest oil producer, has declined to comment this week on falling oil prices. Nigeria and Venezuela last week said they will cut production by a combined 170,000 barrels a day starting on Oct. 1. The group's President Edmund Daukoru yesterday urged members to follow Nigeria's example.
Post a Comment