Crude oil prices posted their
biggest drop this year Wednesday after a government report showed
a sharp rise in US crude stockpiles.
On the New York Mercantile Exchange, crude oil futures for June
delivery fell 2.59 dollars to end at 51.61 dollars per barrel, the
lowest close since April 18. It was the biggest decline since
December 27. Meanwhile, on London's International Petroleum
Exchange the June Brent oil futures contract declined 1.85 dollars
to settle at 52.29 dollars a barrel.
The Department of Energy said US inventories of crude oil rose
by 5.4 million barrels to 324.4 million in the week ended April 22.
The increase surpassed the rise of 650,000 barrels analysts had
expected. The current oil stockpiles stood at the highest level
since May 2002.
"Crude oil inventories are quite comfortable," said an futures
researcher in St. Louis. "This is traditionally the week where you
get the last build before the summer."
However, US President George W. Bush said a "fundamental
problem" facing the US was that "our supply of energy is not
growing fast enough to meet the demand of our growing economy." He
said that more oil refineries were needed to handle increasing
demand, and the government would "simplify" the paperwork and
permits needed to build them.
In New York, oil futures had declined from a record high of 58.
28 dollars a barrel reached on April 4. But prices remained 38
percent higher than a year ago.
Analysts said high-energy prices were slowing economic growth
in the US, Europe and Japan.