US diesel inventory highest since 1985

By Ana Campoy Oil bulls betting that a burgeoning economic recovery would boost crude prices got another slap today. New government data showed that the nation’s fuel stockpiles continue to balloon as demand for them remains in the doldrums. Diesel inventories, in particular, soared to their highest level since 1985, more than 30% above their level at this time last year. Crude prices, as was to be expected, sank some more to below $61 a barrel. More than any other fuel, diesel reflects the current state of the economy because it is used by truckers to deliver goods and by factories to make products. It’s also a good gauge on the global economy: Unlike gasoline, the bulk of which is consumed in the U.S., diesel is used all over the world. And what diesel demand is saying is that the economy is still in a sickly state. U.S. diesel consumption, which has been dismal for most of the year, was down an average 12.3% over the past four weeks. In the futures market, prices for heating oil, a proxy for diesel, tumbled more than 60% from their peak in July of last year. That’s a bigger drop than those of gasoline and crude prices, which have fallen 52% and 57% respectively since that time. … Swimming in Diesel: Huge Oil Stocks Show No Recovery in Sight