Americans burned through a lot less gasoline and diesel fuel than expected last week, feeding into investor angst over oil demand.
Futures slid as much as 1.1 percent in New York on Wednesday, declining for a third straight day, after the US Energy Information Administration said stocks of gasoline and distillate fuels grew by a combined 9.25 million barrels last week, well above analyst estimates. Overall crude inventories did decline by more than 3 million barrels, but that was driven in part by temporary production outages related to Hurricane Barry.
“We’re at the heart of summer driving season, so you would expect demand to be at it’s highest right now,” said Brian Kessens, a portfolio manager and managing director at Tortoise in Leawood, Kansas. The big build in fuel supplies is “a little bit concerning, especially if we see this continue in future reports.”
West Texas Intermediate for August delivery surrendered an earlier gain and was down 47 cents to $57.15 a barrel on the New York Mercantile Exchange.