New York’s main crude oil contract plummeted on Wednesday as traders were swept with relief by news of a surge in United States commercial crude oil inventories.
Light sweet crude for delivery in December plunged to a low of $53 a barrel and was trading late in the morning at $53,65, still down $1,52.
Crude oil inventories surged by four million barrels to 283,4-million barrels in the week to October 22, near the lower lower end of average for the season, the Energy Department said.
Stocks of crude oil were booming because of imports, possibly as Louisiana offshore platforms returned to work, said Alaron Trading market analyst Phil Flynn.
”Sharply falling supplies may be ready to turn the corner,” he said.
But the government report also showed distillates — mostly heating oil and diesel — fell for the sixth consecutive week, declining by 2,4-million barrels to 116,6-million, below the average range.
A breakdown showed heating oil inventories, in high demand in the northern-hemisphere winter, slipped by 600 000 barrels to 48,9-million. Diesel fell 1,8-million barrels to 65,5-million.
Gasoline stocks rose by 1,3-million barrels to 202,1-million, about average, the government survey showed. — Sapa-AFP