Crude oil and gasoline tumbled after a government report showed that inventories climbed last week as consumption declined. Supplies of crude oil rose 2.09 million barrels to 339.9 million, the highest level since August, the Energy Department said today. Gasoline supplies surged 4 million barrels to 214.1 million. Fuel demand slipped 2.6 percent as refineries reduced operating rates for the fourth time in five weeks.
“Prices should be much lower given how high inventories are,” said Chip Hodge, who oversees a $9 billion natural resource bond portfolio as senior managing director at MFC Global Investment Management in Boston. “There’s certainly no lack of oil. If I were an oil producer, I would be very happy because the fundamentals don’t justify these prices.” Crude oil for January delivery fell $1.69, or 2.2 percent, to $76.68 a barrel at 11:54 a.m. on the New York Mercantile Exchange. Oil traded at $77.70 before the release of the report at 10:30 a.m. in Washington.
Gasoline for January delivery declined 4.71 cents, or 2.3 percent, to $1.9952 a gallon in New York. Heating oil for January delivery slipped 3.25 cents, or 1.6 percent, to $2.0455 a gallon.....Read the entire article.
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