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Another Big Reason to Think Oil Prices Aren't Going Up Soon# c# y# w* Z5 `" C: ^3 s0 n
6 S7 E6 v6 R; F! d9 s0 Bby Tom Randall- _ Y* q- l0 i" h1 I& B
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Oil just had its first weekly decline in a month, breaking a rally in crude prices. A bit of context: After what's happened over the last year, "rally" seems a bit of an overstatement. $ n( c) |3 Q( q/ S
Oil 'Rally'
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One big factor that may be driving prices down this week: The U.S. is pumping so much oil it's running out of places to stash it.
6 H: j$ q5 X4 _, s3 K; s: ?Crude oil in storage in the U.S. has jumped to the highest levels in at least 80 years, according to a Bloomberg Industries analysis. The EIA this week reported that U.S. inventories rose 7.7 million barrels to 425.6 million. That's more than 20 percent higher than the five-year average. M+ _/ l/ L0 J8 p% s+ V
U.S. Oil Inventories Reach 80-Year High
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% Q2 Y% h2 e: Q. V! z$ p2 SThe buildup of supply has been "colossal" and is responsible for oil prices falling this week, Thomas Finlon, director of Energy Analytics Group LLC, told Bloomberg News. - C, J I( I- K* s
Winter weather and refinery outages have contributed to the supply glut. Even when those conditions subside, topped-out inventories and continued production growth may continue to suppress oil prices for the near- and medium-term, according to Bloomberg Industries. 8 G6 y. F5 D7 D# g5 {- p! V# d" P
Meanwhile, the U.S. is pumping oil at a faster pace than any time since 1972.; G- A( B4 R# h2 h& ~) k8 m' V# [
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U.S. oil production since 1983. Source: EIA
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