Oil prices fall after massive crude buildup - Houston Chronicle

Oil prices plunged Wednesday after the Energy Department reported a massive crude inventory buildup during the first week of December.

Domestic commercial oil inventories during the week ended Dec. 4 jumped by 15.2 million barrels compared with the previous week. The national crude supply sits at 503.2 million barrels, about 11 percent higher than the five-year average for this time of year, the Energy Department said Wednesday.

The report came as a surprise to investors, who were anticipating a smaller rise in the U.S. crude supply even as millions of Americans stayed home over the Thanksgiving week. The American Petroleum Institute on Tuesday said it expected a crude inventory rise of 1.1 million barrels. S&P Global Platts’ Monday survey of oil analysts predicted that the U.S. commercial crude stock would fall by about 700,000 barrels.

West Texas Intermediate, the U.S. benchmark, dropped by nearly 1 percent to $45.25 on Wednesday morning.

HOLIDAY TRAVEL: Gasoline sales plunged over Thanksgiving week as pandemic kept millions home

Oil markets remain shaky as some U.S. states have imposed new business and travel restrictions aimed at slowing the spread of the novel coronavirus, depressing demand for gasoline and jet fuel. If travel continues to remain low during the holiday season, it will likely exacerbate the challenges facing Houston’s oil and gas industry. Some refineries are closing as demand for petroleum products have plunged during the pandemic.

U.S. refineries processed an average of 14.4 million barrels of crude oil per day last week, a up 424,000 barrels per day compared to the previous week. Refineries operated at nearly 80 percent of their capacity, the Energy Department said.

Gasoline inventories rose by 4.2 million barrels last week and are about 5 percent above the five-year average for this time of year. Meanwhile, gasoline production fell last week, averaging 8.3 million barrels per day.

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Oil prices fall after massive crude buildup - Houston Chronicle
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