US oil inventories had another massive build last week
According to the Energy Information Administration, crude stockpiles rose by 4.7 million barrels last week. It was the biggest rise in nearly five months.
This data follows the report from the American Petroleum Institute on Tuesday evening that showed a huge build by 7.6 million barrels, also the biggest in nearly five months.
Following the API release, West Texas Intermediate crude oil collapsed 10%, after being down about 7% earlier.
And after the EIA release, WTI slipped nearly 3%.
WTI has been incredibly volatile over the past few days. Yesterday's drop wiped away its biggest three-day climb in 25 years, from below $40 per barrel. And this morning, WTI futures recovered into the green to hover near $45 per barrel.
Yesterday, we highlighted Citi's comments that the 30% rebound in oil prices last week was not driven by fundamentals. Instead, the market misread comments from the 12-member cartel OPEC that it is ready to dialogue with other producers, according to Citi's Ed Morse, even as it continues to exceed its production targets.
Here's a chart showing the weekly rise and fall in oil inventories:
