Crude oil drops over $3 on EIA inventories data

Crude oil prices fell significantly Wednesday after the US Energy Information Administration reported that stockpiles were up unexpectedly last week.

The EIA said that crude oil inventories added 5.1 million barrels in the week ending 24 July to 347.8 million barrels while gasoline inventories were 2.3 million barrels lower as the refiners made less of the fuel, but distillates in storage added 2.1 million barrels to 162.6 million barrels.

A decline of 2.5 percent in durable goods orders in the US in June also hurt oil prices.

September contracts for West Texas Intermediate crude were $3.65 lower to $63.58 per barrel about half an hour before the close of floor trade on the New York Mercantile Exchange, while Brent crude had dropped $3.36 to $66.52 per barrel at last report from the ICE Futures Europe exchange in London.

Nymex September heating oil futures were 9 cents lower to $1.70 per gallon in afternoon trade in New York, while September natural gas was down 22 cents to $3.47 per million British thermal units.

September copper was 4 cents lower to $2.48 per pound in New York trade on Wednesday as demand worries resurfaced on the possibility that China has stockpiled more of the metal that it can use soon as well as on concerns that demand created by China’s stimulus spending cannot outbalance demand declines in other areas of the world.

Gold also declined, hurt by a strengthening dollar and the decline in durable goods orders.

December gold was $12 lower to $929.70 per troy ounce in New York trade, September silver fell 48 cents to $13.26 per troy ounce, October platinum was down $24.40 per troy ounce to $1,172.20 per troy ounce, while earlier, in late morning trade, September palladium dropped $4.50 to $255.50 per troy ounce.

Grains prices, on the other hand, were nearly unchanged in afternoon trade in Chicago.

August soybeans and September corn each added less than a cent, to $10.58 per bushel and $3.21 per bushel respectively, while September wheat was down less than a cent to $5.11 per bushel.

Story link: Crude oil drops over $3 on EIA inventories data