EIA’s weekly US Petroleum Report, released earlier today, shows that stocks of oil surged last week. The amount of crude oil in commercial storage tanks jumped by about 10.9 million barrels to 482.2.
This was the largest weekly rise since March 2001. US stocks of crude oil are now 20% above last year’s high and show no signs of peaking. The upshot is that high levels of oil production and the unprecedented level of stocks will continue to keep the price of US oils, such as WTI, below that of Brent. “Data seem to confirm that last week’s fall in oil production and relatively small increase in crude stocks were more of a blip than a sign that the current upward trend in output and stocks was coming to an end.” – said Capital Economics in a report on Wednesday
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