Oil prices fall amid ample gasoline
Report shows U.S. gas inventories rose by 3.3 million barrels
Reuters
LONDON, June 27 - World oil prices fell
Wednesday after a sharp build in U.S.
gasoline stocks stoked concerns that
American motorists are cutting down on their
mileage this summer amid a slowdown in the
U.S. economy.
STORY CONTINUES BELOW
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IN EARLY WEDNESDAY trading, London Brent blend
tumbled 59 cents to $26.40 a barrel and U.S. light sweet crude
dropped 49 cents to $26.49.
Weekly U.S. stock figures from the American Petroleum
Institute (API) knocked down unleaded gasoline futures, which
skidded 2.39 cents to 75.40 cents a gallon.
The API reported a 3.3 million barrel increase in U.S. gasoline
tanks to 222.9 million barrels in the week to June 22, the tenth
week in a row that stocks have risen.
The sharp gain - industry sources had earlier forecast a build of
only 1.15 million barrels - came during vacation season in the
United States when gasoline demand would normally be
reaching a seasonal peak.
Analysts said consumption was being held down by high pump
prices earlier this year and a slowdown in the U.S. economy.
Previous concerns of a potential summer supply crunch had
been eradicated, they said.
"The lingering concern over stock positions has been
completely blown away by the (tenth) consecutive week of stock
building on gasoline," said John Russel, managing director of
consultants PEL Pacific in Bangkok.
"There's no doubt about it - demand is being crimped," said
Tim Evans, senior analyst at IFR-Pegasus.
The gasoline build in the week ended June 22 came despite
traditionally strong driving demand in early summer, and
despite a decline in refinery utilization of 0.8 percent to 94.2
percent, the report showed.
The API showed crude stocks rising by a modest 565,000 barrels
to 313.5 million barrels. U.S. crude inventories of 313.5 million
barrels now are 20 million barrels, or seven percent, higher
than a year ago.
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