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By Samuel R. Avro on Dec 24, 2008 with no responses

Crude Oil Tumbles as Stockpiles Continue to Grow

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A government report showing growing stockpiles in gasoline and distillate fuel caused crude oil to drop sharply today – its ninth consecutive losing day.

Light, sweet crude for February delivery fell $3.63, or 9.3 percent, to settle at $35.35 on the holiday shortened trading day in New York.

The Energy Department reported that gasoline inventories rose 3.34 million barrels to 207.3 million barrels last week. Distillate stockpiles, which includes heating oil and diesel, climbed 1.81 million barrels to 135.3 million barrels.

Bleak economic data has contributed to the decline in the futures market, with new claims for unemployment unexpectedly rising last week.

The Labor Department reported that initial requests for jobless benefits rose to a seasonally adjusted 586,000 in the week ending Dec. 20, from an upwardly revised figure of 556,000 the previous week. Economists were expecting a much lower 560,000 figure.

Amid the worst recession in a generation, Americans are cutting back on driving. That’s leading to the growing stockpiles of gasoline even as prices continue to plummet

Crude oil futures have tumbled in a mere few months, and are now trading at levels well below their high of $147 reached in July.