Oil prices slide below $49

EIA says crude, gasoline supplies posted a greater-than-expected rise last week.

May 4, 2005: 10:38 AM EDT

NEW YORK (CNN/Money) - Oil prices fell Wednesday after a government report showed that crude and gasoline inventories grew by much more than expected last week.

Immediately following the report, U.S. light crude for June delivery lost 60 cents to $48.90 a barrel on the New York Mercantile Exchange. Just before the Energy Information Administration release, the contract was up about 45 cents, hovering just below $50.

The EIA said crude oil inventories rose by 2.6 million barrels in the week ended April 29, far greater than the 1 million barrel rise forecast by Reuters.

At 327 million barrels, crude oil inventories are above the upper end of the average range for this time of year, and the highest since the end of March 2002, the EIA said.

Moreover, closely watched gasoline stocks jumped by 2.2 million barrels. Reuters had forecast a 700,000 barrel increase.

Distillate fuel stocks fell by 300,000 barrels, the EIA said, versus Reuters' forecast for a 700,000 barrel rise in distillate inventories.