Oil Tumbles 12 Percent as U.S. Supplies Rise More Than Forecast

[Purveyor]

Source: Bloomberg

By Mark Shenk

Jan. 7 (Bloomberg) -- Oil futures tumbled 12 percent, the most in more than seven years, after a U.S. government report showed a bigger-than-expected increase in supplies of crude oil, gasoline and distillate fuel as demand dropped.

Inventories of crude oil rose 6.68 million barrels to 325.4 million barrels last week, the highest since May, the Energy Department said today in a weekly report. Supplies were forecast to increase by 800,000 barrels, according to the median of forecasts by 14 analysts in a Bloomberg News survey.

“We have the making of a huge glut here,” said Phil Flynn, senior trader at Alaron Trading Corp. in Chicago. “Supplies are more than adequate and should continue to rise because demand is so poor.”

Crude oil for February delivery fell $5.84, or 12 percent, to $42.74 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Prices are heading for the biggest one-day decline since Sept. 24, 2001. Futures are down 55 percent from a year ago.

Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=aLCxveS8.mmk&refer=home

[skorpo]

1. Strange?? Gas prices have been going up in the Chicago Area. n/t

[radfringe]

3. oil jumped over the past week before dropping again

gas in a few stations in my area went up 10-cents overnight, I expect they'll drop again by a penny a day

think of this as a gas bubblette - and it burst before growing larger

meanwhile - did they expect people to start taking trips again just because gas is down? Gas isn't the only factor in spending declines among consumers, job loss, fear of job loss and generally being strapped for cash is keeping people close to home, plus it's winter and people are more concerned with keeping home warm than going for sunday drives

The goose that lays golden eggs (consumers) have been strangled, and a little drop in gas isn't going to revive the goose.

Welcome to the Bush-Cheney-Republican Depression

[demosincebirth]

10. Sure is strange, Same here in the Bay Area.

[Divine Discontent]

13. I was shocked to see it up 20 cents here too, hope it goes below 1.50 - we've been screwed for so

long with it above 3.... most people's discretionary spending was eaten by the oil companies.

[Fridays Child]

2. Cheap money and lotsa gas?

You can almost hear the hurrah coming from Detroit.

[GreenTea]

4. Will Bush's legacy be that gas was the same price at the pumps when Bush took office & left office?

And no mention how he allowed the BushCo oil companies to rip us off, fleece us, gouging us outrageously for years for record corporate profits in between those eight years?

Will we forget that over time?

That motherfucking Bush & the republicans!!

[Fridays Child]

7. Yeah, forget about those pesky years in the middle.

Fox Noise will just proclaim, ad infinitum, that gas prices were the same at the end of the Bush II administration as they were at the beginning. They know that a thing said often enough becomes the truth. In fact, it's their operating formula.

Maybe it's also more than a coincidence that a match has been thrown on the Middle East tinder box, just as Obama is coming in. When the whole region eventually ignites, it'll make for a plausible reason to jack the price back up to $150 a barrel, or even higher.

[BelgianMadCow]

5. ...rises 8 TIMES more than analysts' consensus...

:wow:

[Phred42]

6. Pump price here went from $1.64 to $1.99 in teh past few days

Suppply and barrel price have nothing to do with pump price

[jimshoes]

8. Same where I'm at

Near Cleveland.

[2Design]

9. went up 20 cent over 5 days n/t

[Lugnut]

11. Huh?

The pump price went up ten cents in two days here.

[gratuitous]

12. Dammit people!

Start driving around aimlessly and running up more credit debt! How is this gonna look on Bush's legacy if you're not going to cooperate? Don't any of you care how this is going to reflect on Dubya? You're all just so . . . so . . . selfish!