U.S. crude inventories break decades-old record after huge build

A pipeline sign marks the main U.S. oil pipeline and storage hub at Cushing, Oklahoma. (Bloomberg photo)
A pipeline sign marks the main U.S. oil pipeline and storage hub at Cushing, Oklahoma. (Bloomberg photo)

U.S. inventories of crude oil topped 500 million barrels for the first time in decades, according to the U.S. Energy Information Administration’s weekly storage report.

A higher-than-expected build of 7.8 million barrels for the week ending on Jan. 29 pushed inventories to 502.7 million barrels — a total not seen in at least 80 years, the EIA said in its report released Wednesday — and sent oil prices tumbling.

Data made available from the EIA only goes back to 1982, but crude inventories have never topped 500 million barrels in that time.

Prices for the benchmark U.S. crude climbed by $1.23 to $31.11 at 9:48 a.m. on Wednesday, but fell as low as $29.40 shortly after the report was published.

The build reflected decreasing demand for gasoline — refineries last week operated at 86.6 percent of capacity, 0.8 percent lower than the week prior and a falloff of several percentage points from January when capacity topped 90 percent.

Stocks of gasoline rose to 254.4 million barrels, the most in 34 years. The last time gasoline inventories got close to that mark was in 1990, when stores rose to 251.1 million barrels.

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