BLBG: Crude Oil Futures Fall as U.S. Supplies Climb by the Most in Nine Months
Crude oil declined after a U.S. Energy Department report showed that inventories surged by the most in nine months as imports increased.
Futures slipped as much as 1.3 percent after the government said supplies rose 6.16 million barrels to 363.1 million last week. It was the biggest one-week advance since July. Stockpiles were forecast to increase 1.7 million barrels, according to the median of 13 estimates in a Bloomberg News survey. Imports rose 15 percent, the biggest one-week gain since October 2008.
“The big build in crude stocks was a major surprise,” said Sean Brodrick, a natural resource analyst with Weiss Research in Jupiter, Florida. “The oversupply of oil is weighing on the market right now. Refiners have got to convert more of the oil into gasoline in coming weeks.”
Crude oil for June delivery dropped 77 cents, or 0.7 percent, to $111.44 a barrel at 10:48 a.m. on the New York Mercantile Exchange. Prices are up 35 percent from a year ago.
New York futures traded at $111.35 a barrel before the release of the report at 10:30 a.m. in Washington.
Brent oil for June settlement slipped 19 cents to $123.95 a barrel on the London-based ICE Futures Europe exchange.
Crude oil also declined on speculation Federal Reserve officials will prepare to pull back from record stimulus by dropping a pledge this year to hold the main interest rate near zero for an “extended period,” a Bloomberg News survey showed.
Thirty-three of 44 economists surveyed said the central bank will remove the two-word phrase from its post-meeting statement in 2011, with 18 betting it will move by September.
Consumer Confidence
German consumer confidence will decline for a second month in May as households grapple with higher food and energy prices, GfK AG said. Germany is Europe’s biggest economy and the seventh-biggest oil consuming country.
The Nuremburg-based market research company today forecast that its consumer sentiment index, based on a survey of about 2,000 people, will fall to 5.7 next month from 5.9 in April. Economists predicted a decline to 5.8, according to the median of 26 estimates in a Bloomberg News survey.
To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net
To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net
