US crude futures plunge $4.39/bbl on stockpiles announcement

23 June 2011 21:32  [Source: ICIS news]

HOUSTON (ICIS)--NYMEX light sweet crude for August delivery settled at $91.02/bbl, down $4.39, on Thursday following the surprise announcement by the Paris based International Energy Agency (IEA) that industrialised oil consumer nations will release 60m bbl of oil during the next 30 days from strategic stockpiles.

The US, a member nation, said it it would contribute and put out for competitive bid 30m bbl from the Strategic Oil Reserve (SPR) for the purpose of countering the loss of oil supplies from Libya and in a wide effort to pressure oil prices.

Crude prices were also pressured by a strong dollar and a sell-off in the stock market in response to data showing a disappointing jump in US jobless claims.

August crude plunged to $89.69bbl, down $5.72 versus the previous close, before the events were factored in and the dip was viewed as a buying opportunity.

Currently, the SPR holds 726.5m bbl in stockpile. Thirty million barrels constitute about 1.5 days of US oil requirements.

ICE Brent for August delivery sold down to $105.72 before settling at $107.26/bbl, down $6.95.

By: Ignacio Sotolongo
+1 713 525 2653

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