US oil stockpiles have risen for the 11th consecutive week, hitting yet another record.
The EIA reported Wednesday that oil inventories increased 8.2 million barrels, or 1.8%, to 466.7 million barrels last week. US production also continued to rise- to a rate of 9.42 M/bd- marking the 7th straight weekly increase.
Stockpiles are now more than 25% above their 5-year average. Though inventories are not likely to max out, even the potential of nearing this threshold is exerting further pressure on the oversupplied oil market.
According to a note released by Morgan Stanley Wednesday, “US crude stocks will build through May, but there is plenty of storage. The system is more flexible than most realize.” The bank also said that tank farm utilization in the US could peak at 73%. “However, record builds should support bearish sentiment for now,” Morgan Stanley said.