United States crude inventories grow

United States crude-oil inventories increased last week by 2.2 million barrels to 384.7 million barrels, the Energy Department reported Thursday. The 0.6 percent gain from the previous week took U.S. supplies nearly 3 percent above year-ago levels, the department’s Energy Information Administration (EIA) said. Gasoline inventories fell by 800,000 barrels, or 0.4 percent, to 200.2 million barrels, nearly 6 percent below year-ago levels. Demand for gasoline over the past four weeks was 2.6 percent lower than a year earlier, averaging 8.9 million barrels per day (bpd). Supplies of distillates-including diesel, heating oil, and jet fuel-fell by 1.7 million barrels to 117.8 million barrels. U.S. refineries operated at 89.1 percent of capacity on average, up 1.6 percentage points from the previous week, the EIA said. On Wall Street, oil prices fell on reports that the U.S. economy is not growing as strongly as expected. Benchmark crude was down more than $1.25 to near $86.50 a barrel in late-morning trade on the New York Mercantile Exchange. Oil now is the cheapest it has been so far this year. Prices have been dropping for several reasons. On Thursday, the U.S. government reported that the economy grew by 1.9 percent in the first quarter, slower than the 2.2 percent annual rate initially estimated. The number of people seeking unemployment benefits also rose last week to a five-week high. Meanwhile, tensions are easing over Iran’s controversial nuclear program, reducing prospects for a conflict in the Gulf.