WTI Crude Drops as U.S. Oil Stockpiles Gain

West Texas Intermediate fell for the second time in three days after data showed U.S. crude stockpiles rose the most in four weeks and a government order prevented the restart of a pipeline to the Texas Gulf Coast.

Futures slid as much as 0.7 percent in New York. Crude inventories climbed 4.7 million barrels last week, the most since March 1, according to the American Petroleum Institute. Government data today may show supplies rose 2.1 million barrels. Exxon Mobil Corp.’s Pegasus pipeline, which runs from the Midwest to Texas refineries, will stay shut until regulators are satisfied with repairs. The main rebel group in Nigeria’s oil-rich Niger River delta said it will resume assaults.

“Crude builds are normal at a time of high seasonal refinery maintenance,” said Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research company in London whose forecast for oil in the first quarter was within 0.6 percent of actual price levels. “The longer the Pegasus outage lasts, the more it is likely to weigh on WTI.”

WTI for May delivery declined as much as 68 cents to $96.51 a barrel in electronic trading on the New York Mercantile Exchange and was at $96.62 at 1:46 p.m. London time.

Brent for May settlement retreated for a second day on the London-based ICE Futures Europe exchange, dropping 99 cents to $109.70 a barrel. The contract decreased 0.4 percent to $110.69 yesterday. Brent, the European benchmark crude grade, was at a premium of $13.08 to WTI, versus $13.50 yesterday. The volume of all WTI futures traded was 27 percent below the 100-day average, while Brent trading was 22 percent above.


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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