Wednesday, June 20, 2007

Oil tumbles on big jump in inventories

Prices fall after crude, gasoline supplies post surprise increase ahead of summer driving season.

NEW YORK ( -- Oil prices sank nearly $1 Wednesday after a government report said supplies of crude and gasoline jumped more than Wall Street had expected.

U.S. crude for July delivery slid 89 cents to $68.21 a barrel on the New York Mercantile Exchange. Oil had traded down 21 cents just prior to the report's release.

In its weekly inventory report, the federal government's Energy Information Administration said gasoline supplies, closely watched in the summer driving season, climbed 1.8 million barrels last week. Analysts were looking for a 1-million-barrel rise, according to Reuters.

Crude stocks jumped 6.9 million barrels, while distillates, used to make heating oil and diesel fuel, also rose by 100,000 barrels. Analysts were looking for an increase of 100,000 barrels of crude and an 800,000-barrel increase in distillates.

The report comes as traders have been focused on whether struggling U.S. refiners could lift supplies of gasoline during the peak summer demand season, while also reviving low heating fuels stocks, Reuters reported. Top of page

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