Oil Continues to Drop After US Crude Inventories Rise

Oil prices fell on Thursday, to deepen losses for the fifth straight day. This downfall is due to an increase in the US Crude Inventories and fears over the European demand recovery.

The energy information Administration said the US Crude Inventories increased by 2.4 million barrels for the week that ended March 12 and analysts forecast a rise by 2.8 million barrels. They noticed the increase for more than three weeks.

US crude fell 1.0% to $63.78 a barrel, after opening at $64.40, and hit a day high at $64.69, and Brent crude fell 1.2% to $67.10, after opening at $67.90, and hit a day high at $68.04. US Crude  Inventories fell by 0.6% yesterday, and Brent crude futures fell 1.1%, due to renewed global demand concerns.

The total commercial inventories rose to about 501 million barrels, the highest level since the week ending December 11. The production last week held at a total of 10.9 million barrels per day, which is the highest level in a month and a half.

Matt Smith, director of commodity research at ClipperData said that as there is refining activity on the Gulf coast and the refinery hub of the US is continuing to rebound after Texas winter storms. He also added that  Over three-quarters of last week’s 1.1 million barrel-per-day increase in refinery runs occurred on the Gulf Coast

The EIA reported that Gasoline supply increased 500,000 barrels, while distillate stockpiles inched higher by 300,000 barrels for the week. The S&P Global Platts survey had forecast supply declines of 1.4 million barrels for gasoline and 900,000 barrels for distillate inventories.