Oil Prices Continue Slide on Inventory Data

The price of crude fell by 4.2 percent to $60.43 a barrel and the price of heating oil gave up 3.8 percent.

HEAT USA Price Report
Evening projection (for Thursday’s average retail heating oil price per gallon): DOWN $0.06

The Energy Information Administration released data for last week’s US inventory numbers of petroleum products that reinforced perception of persistent low demand for diesel and gasoline.  The EIA numbers showed a 3.7-million-barrel increase in distillate stocks, which include road diesel and heating oil.  The increase was substantially larger than the 2-million-barrel increase predicted by industry experts, and put total distillate inventories near their highest levels in 25 years.  The data also showed a 1.9-million-barrel increase in gasoline stocks, despite the passage of the 4th of July holiday, typically the peak the US driving season and gasoline demand.  Nervous sell-offs of oil holdings in response to the CFTC’s recent announcement of plans to tighten oil speculation regulation also contributed to lower prices.

HEAT USA price experts predicted a much larger price decrease than they expected this morning, attributing it to the large build in distillate inventories.