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Oil Is Heading Straight Down as Inventories Rally

April 18, 2012 at 15:18 by Andriy Moraru

The crude oil prices declined today for the second day this week and have already reached the 2-month low level in reaction to the increased commodity inventories reported by both American Petroleum Institute and US Energy Information Administration.

Oil has already lost 4.5 percent since the beginning of this month. It is hurt by almost every news event except for the worrying news from Middle East. Other than that, European debt crisis, China’s growth slowdown, and growing stockpiles are all pushing the balance of bulls and bears towards the lowest limits of charts.

API reported 3.41 million barrels gain in the commercial crude oil inventories for the last week today. Then, the EIA report showed an increase of 3.86 million barrels for the same period. Despite the fact the gasoline inventories dropped almost at the same pace (-3.67 million barrels), the market reacted with a sharp downward movement for oil.

Brent spot price went down from $118.61/barrel to $116.98/barrel as of 15:14 GMT today. It reached the daily minimum of $116.75/barrel during the early trading session. It is the lowest level since February 14.

If you have any questions and comments on the commodities today, use the form below to reply.

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