Posted on 03/08/2006 9:53:00 AM PST by sully777
NEW YORK (Reuters) - U.S. commercial crude supplies shot to the highest level in nearly seven years last week on sluggish refinery use and high imports, the government said on Wednesday.
U.S. oil stocks jumped 6.8 million barrels in the week ended March 3 to 335.1 million barrels, or 10 percent higher than last year, according to the Energy Information Administration (EIA), the statistical arm of the Department of Energy.
"The crude build is huge," said Jason Schenker, an economist at Wachovia Bank in Charlotte, North Carolina.
Oil futures on the New York Mercantile Exchange fell more than $1.00 after the report to $60.55 a barrel. In May 1999, the last time supplies were as high, oil futures were less than $17 a barrel.
Refineries operated at 83 percent of capacity, down 2.2 percentage points on the week and a slump of 6.5 percentage points from the same time last year.
As a result of the low output, gasoline supplies fell for the first time in 10 weeks. Supplies of the motor fuel fell 1.1 million barrels to 224.8 million barrels.
But even with the slip, gasoline supplies remain above the upper end of the average range, according to the EIA. "Gasoline inventories are very well supplied going into the summer market," said Schenker.
And Kyle Cooper, analyst at Citigroup Global Markets, said supplies could soar when plants return. "After that you will see a flood of refined products," he said. Refiner maintenance is high this winter as many plants catch up with work that had been delayed by a wave of hurricanes last year.
At least three big coker units were set to restart in early March, including Exxon Mobil's coker at Baytown, Texas, and Valero's cokers in Corpus Christi, Texas and Aruba, according to a Reuters survey.
Distillate stocks, which include heating oil and truck diesel, fell 2.7 million barrels to 131.4 million barrels, but were still nearly 14 percent above last year.
Crude oil imports averaged 10.1 million barrels per day last week, up 267,000 bpd from the previous week, the EIA said.
Nymex Gasoline Future (April Contract)
173.31
+1.30
There's a surplus at a 7 year high and yet the price goes up.
I don't know for sure. It had a nice run up since the beginning of the year. I hope you got in before that. If so, I'd take some cash off the table right now. What do you think?
Thanks for your response.
I just found out about the stock, was thinking of getting in. Sounds like they are in the place to be for future drilling spots.
But as you said, it's had a run up for awhile. I might have missed the best time to buy.
I'm rather new at stocks, so I appreciate your thoughts on it.
Somebody in Gummint said the price would be up to $2.50 this summer. How do they know this?
Coincides with about a $.35/gal rise in Texas gasoline this last week. (Expected to go to about $2.50 before the summer driving season.)
Then just wait for the hurricanes......good excuse to jump the gas price up to $3.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.