This week's American Petroleum Institute (API) reported a massive 9.3 million barrel build in United States' crude oil supplies - the largest increase since March of this year.
Experts polled by ZeroHedge expected a seasonally consistent 1.54-million-barrel build, but instead, API figures show the largest jump in inventories for eight months.
Distillate supplies saw the sixth straight week of declines, but supplies at Cushing, Oklahoma saw the largest spike in three months.
Gasoline supplies experienced the largest decline in two months, down 3.5 million barrels against the more modest one-million-barrel drop that was forecasted.
West Texas Intermediate crude prices sank 1.13 percent with the report's release, stabilizing at $46.33. Brent prices traded down 1.42 percent at $47.92 at the time of this article's writing. Oil had rallied earlier in the day on a slipping dollar, and after Colonial Pipeline had to shut down its main pipeline for a second time in as many months following an explosion. WTI had reached as high as $47.35 on Tuesday.
ZeroHedge noted that domestic crude inventories are still 29 percent higher than the seasonal average.
"The global glut continues to march on," Phil Streible, senior market strategist at RJO Futures in Chicago, told the economics blog.
Tomorrow's official inventory report from the Energy Information Administration (EIA) will determine whether the API's numbers are accurate, and will no doubt swing markets back upward should the EIA determines there was in fact a more modest build.
By Zainab Calcuttawala for Oilprice.com
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Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on… More
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