Crude prices falls again as inventories swell

Crude oil prices fell again on Thursday, bringing the decline since record highs were set last week to over 9 percent. Helping that decline was the release of weekly inventory figures by the US Energy Information Administration.

Crude oil inventories were down by 6.4 million barrels in the week ending September 2, about the decline that was expected. Gasoline stockpiles declined by 4.3 million barrels, less than the expected drop of 6.2 million barrels. Distillates inventories were down by 0.8 million barrels, also less than expected. Analysts had thought distillates stockpiles would be down by as much as 2.6 million barrels.

The numbers, especially of gasoline and distillates had been expected to be much greater due to the number of refineries put offline by Hurricane Katrina. With more in inventories and gasoline being brought in from outside the US as aid after the storm, most analysts saw indications that supply would be plentiful.

However, one analyst cautioned that the figures did not include drawdowns of inventory from gasoline in storage at filling stations, that were necessary when pipelines on the East Coast had to be shut down due to the hurricane.

West Texas Intermediate crude for October delivery traded on the New York Mercantile Exchange lost 12 cents to $64.25 per barrel after the inventories data was released, but recovered to end the session up 12 cents to $64.49 per barrel.

Meanwhile, Brent crude October contracts on the International Petroleum Exchange fell by 21 cents to $62.28 per barrel during the day. The price of Nymex heating oil was down on the day, by 3 cents to $1.93 per gallon.