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Oil Prices Drop as Inventories Remain High
Oil futures fell almost 5% on Thursday after the Energy Information Administration reported that U.S. inventories of oil and gasoline are dropping less than expected.
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Oil futures fell almost 5% on Thursday after the Energy Information Administration reported that U.S. inventories of oil and gasoline are dropping less than expected.
EIA says gasoline inventories declined by only 2.2 million barrels to 524 million barrels last week. The dip was one-third what the American Petroleum Institute forecast, even though the summer driving season has pushed up consumption.
The U.S. crude oil benchmark (West Texas Intermediate) and the global standard (Brent crude) each shrank nearly 5% to settle at $45.14 and $46.40 per barrel, respectively, on Thursday.
The dip at least temporarily stalled an oil price rally that has hiked futures 70% from a 13-year low in February. Still, prices are struggling to remain above $50 per barrel, less than half their price in mid-2014. Analysts predict a gradual rise as consumption slowly outpaces output into 2017.
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