Crude oil supplies overwhelm refineries

The US and Europe are releasing more emergency crude oil than refineries in the Gulf of Mexico can handle, reinforcing suspicions that governments are using the crisis triggered by Hurricane Katrina to cap record oil prices.

US refineries will on Friday begin to bid for the 30m barrels of crude oil that the US government is releasing from the its emergency reserves but, with many refineries disabled, analysts say the additional supply may not be needed.