Stacking the U.S. supply, Oil Prices Fall

Crude oil prices dropped sharply in the past two weeks because, according to U.S. Department of Energy, crude oil inventories in the country exceeds the expected. It is also related to the refining operation is not optimal.

The price of West Texas Intermediate crude oil for delivery May shrank 1.53 dollars to 102.67 dollars per barrel on the Nymex on Wednesday (4/18/2012) New York time. Meanwhile, crude oil futures have fallen 6.5 percent since the price is 109.77 dollars on February 24, 2012 which is the highest price since May 2011.

Meanwhile, Brent crude oil for determination of June also fell 81 cents, or 0.7 percent, to 117.97 dollars per barrel on the ICE Futures Europe exchange in London. "It's another week where there is fighting a big number," said John Kilduff, a partner at Again Capital LLC, New York, on Wednesday.

The fall in oil prices due to the U.S. Energy Department reported that U.S. crude oil inventories rose 3.86 million barrels in the week that ended on 13 April 2012. Though only a Bloomberg survey expect inventories rise by 1.8 million barrels.

With the surge is the rise in U.S. crude inventories had reached 369 million barrels. According to the U.S. Department of Energy, this is the largest number since the week ended May 27, 2011.

This increase in inventories due to refineries operating below 85 percent capacity for the second week. "The industry continues to work on refining the sub-optimal level and crude oil will surely accumulate if they do not cultivate it," added John.

Before the U.S. inventory report, crude oil inventories in the 34 countries that joined the industry in the Organization for Economic Cooperation and Development (OECD) also increased. According to the International Energy Agency on Thursday (4/12/2012), oil supplies in these countries rose 1.8 percent to 936.2 million barrels in February from January.