WTI Oil Declines After U.S. Stockpiles Gain

West Texas Intermediate oil maintained losses after a government report showed that U.S. crude supplies rose as output increased to near the highest level in 20 years.

Futures declined as much as 0.8 percent as the Energy Information Administration said inventories gained 3.26 million barrels to 385.9 million last week. The report was projected to show an advance of 1.33 million, according to a Bloomberg survey. Crude production climbed 1,000 barrels a day to 7.15 million, near the 20-year high of 7.16 million on March 8. Equities decreased and the euro fell to a four-month low against the dollar, putting further downward pressure on oil prices.

“Rising inventories will send the market lower,” said Bob Yawger, director of the futures division at Mizuho Securities USA Inc. in New York. “This is also a risk-off day in crude oil and equities because of issues that have nothing to do with oil fundamentals.”

Crude oil for May delivery decreased 48 cents, or 0.5 percent, to $95.86 a barrel at 10:39 a.m. on the New York Mercantile Exchange. The contract traded at $95.82 before the release of the report at 10:30 a.m. in Washington. The volume of all futures traded was 5.9 percent below the 100-day average.

Brent oil for May settlement gained 2 cents to $109.38 a barrel on the London-based ICE Futures Europe exchange. The volume of all futures traded was 1.5 percent below the 100-day average. The European benchmark traded was at a $13.52 premium to WTI after ending yesterday at $13.02, the narrowest at settlement since July.


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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell