Crude Oil Ends Lower As Stockpiles Surge

(RTTNews) - U.S. crude oil ended lower for a second straight session on Thursday, as oversupply concerns resurfaced after an official weekly oil report from the Energy Information Administration showed crude stockpiles in the U.S. to have surged much more than expected last week.

However, prices recovered somewhat as the jump in stockpiles were not as high as widely anticipated. Crude oil prices tumbled to near $50 a barrel in the morning after industry data showed a staggering build in U.S. oil inventories.

Industry group, the American Petroleum Institute, said its data showed that U.S. crude stocks rose by 14.3 million barrels for the week ended February 13.

Earlier today, a weekly report from the U.S. Energy Information Administration showed U.S. crude oil inventories to have jumped 7.7 million barrels in the week ended February 13, while analysts expected an increase of 3.1 million barrels. The report showed U.S. crude oil inventories at 425.6 million barrels end last week.

Gasoline stocks increased by 0.5 million barrels last week, while analysts anticipated a gain of 0.4 million barrels. Inventories of distillate, including heating fuel, dropped 3.8 million barrels, even as analysts estimated a drop of 2.2 million.

A stronger dollar and lingering concerns about the health of the global economy also hit oil prices. Fairly dovish Federal Reserve minutes failed to provide much support. Nevertheless, oil remains well off the 6-year lows of $44 a barrel reported a few weeks ago.

Gas prices have been rising 22 straight days, with the average U.S. gallon of gas costing $2.26, according to driver group AAA.

Light Sweet Crude Oil futures for March delivery, the most actively traded contract, shed $0.98 or 1.9 percent to settle at $51.16 a barrel on the New York Mercantile Exchange Thursday.

Crude prices for March delivery scaled a high of $52.14 a barrel intraday and a low of $49.15.

On Tuesday, crude oil snapped a three-day gain to settle sharply lower at $52.14 a barrel, down $1.39 or 2.6 percent, as worries over a supply glut resurfaced, investors mulling over minutes of the Federal Reserve's January policy meet.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 94.44 on Thursday, up from its previous close of 94.10 on Wednesday in North American trade. The dollar scaled a high of 94.44 intraday and a low of 93.84.

The euro trended lower against the dollar at $1.1361 on Thursday, as compared to its previous close of $1.1397 on Wednesday in North American trade. The euro scaled a high of $1.1452 intraday and a low of $1.1357.

On the economic front, a Labor Department report on Thursday showing that initial jobless claims in the U.S. pulled back more than expected in the week ended February 14, after reporting increases in first-time claims for unemployment benefits in the two previous weeks.

The report said initial jobless claims dropped to 283,000, a decrease of 21,000 from the previous week's unrevised level of 304,000. Economists had been expecting initial jobless claims to show a somewhat more modest decrease to a level of 290,000.

While the Federal Reserve Bank of Philadelphia released a report on Thursday showing continued growth in regional manufacturing activity in the month of February, the pace of growth unexpectedly slowed for the third consecutive month. The diffusion index for current general activity fell to 5.2 in February from 6.3 in January, although a positive reading indicates a continued increase in regional manufacturing activity. Economists expected the Philly Fed index to climb to a reading of 9.0.

A Conference Board report on Thursday showed its index of leading U.S. economic indicators increased modestly in January, suggesting a positive short-term outlook. The Board's leading economic index edged up by 0.2 percent in January following a downwardly revised 0.4 percent increase in December. Economists expected the index to rise by 0.3 percent compared to the 0.5 percent advance originally reported for the previous month.

The euro area current account surplus declined to a four-month low in December, the European Central Bank reported Thursday. The current account surplus dropped to EUR 17.8 billion in December from EUR 19.9 billion in November. This level was last seen in August.

French consumer prices declined for the first time since October 2009, the statistical office Insee said Thursday. Consumer prices fell more-than-expected 0.4 percent in January from last year, reversing a 0.1 percent rise in December. Prices were expected to drop 0.3 percent. This was the first decrease since October 2009 and matched the 0.4 percent drop seen in September 2009.