UPDATE 9-Oil slumps on worries that supply cuts are playing catch-up to falling demand

* Analysts say producer curbs will take weeks
* EIA sees sharp drop in U.S. shale production
* U.S. storage could be full by mid-May - pipeline co
* U.S. crude stocks jump 13 mln bbls last week -API

(Adds API data)
By Stephanie Kelly
NEW YORK, April 14 (Reuters) - Oil prices dropped sharply on
Tuesday, with U.S. prices sliding back toward $20 a barrel, as
investors bet that fuel demand destruction caused by the
coronavirus pandemic would be too much for producers embarking
on record global output cuts to offset.
Global oil-producing nations are expected to reduce
production by as much as 19.5 million barrels per day, but those
cuts are being implemented slowly and in some cases will not
start for weeks. By contrast, demand plunged by roughly 30%
worldwide several weeks ago, causing refiners and producers
suddenly stuck with oil to stick it into rapidly filling
storage.
U.S. West Texas Intermediate (WTI) crude CLc1 settled at
$20.11 a barrel, down $2.30 or 10.3%, as one prominent pipeline
executive told Texas regulators that storage would be filled by
mid-May.
WTI is not far from where markets traded prior to a rally
founded on hopes for the OPEC+ production deal inked over the
weekend.
Brent crude futures LCOc1 fell $2.14, or 6.7%, to settle
at $29.60 a barrel.
Both benchmarks are down more than 50% down this year.
Analysts have praised Saudi Arabia and other major producers
for cutting output, but those producers are playing catch-up to
the free-fall in demand.
Plains All American Pipeline PAA.N President Harry Pefanis
underscored that point at a hearing in Texas on Tuesday, saying
that U.S. storage would be filled by mid-May. "We can't act as a storage facility for everybody that
doesn't have a market," Pefanis said at a Texas Railroad
Commission hearing, where regulators are considering a cut in
state production.
The bulk of the mandated reductions come from the
Organization of the Petroleum Exporting Countries and its
allies, a group known as OPEC+. That group agreed this weekend
to cut output by 9.7 million bpd in May and June. The rest from
the United States, Canada and others, will come as a result of
weak pricing and happen over time.
"With demand destruction forecasts ranging from 15 million
to 22 million bpd in April 2020 and these measures not even
coming into place until May, we are likely to see a substantial
overhang in the short-term," said Nitesh Shah, director of
research at New York-based WisdomTree Investments.
As a result, physical markets where crude is traded, such as
in Houston or London, suggest prices will not recover for a
while as storage fills.
U.S. crude inventories rose 13.1 million barrels in the week
to April 10 to 486.9 million barrels, data from industry group
the American Petroleum Institute showed on Tuesday. Analysts had
expected a build of 11.7 million barrels, after stocks climbed
by a record 15.2 million barrels the previous week. Official data is due on Wednesday.
"If U.S. storage continued to increase at last week's
all-time record of 15 million, it would take eight weeks for
storage in the U.S. to reach maximum capacity," said Bob Yawger,
director of energy at Mizuho Securities.
Enterprise Products Partners EPD.N said it was making an
existing line available to ship more oil to the Cushing,
Oklahoma storage hub, which is rapidly filling due to lack of
fuel demand. U.S. production is starting to drop, the Energy Department
said on Monday, with estimated shale output expected to fall by
200,000 bpd in April, a record. There are signs that the coronavirus outbreak may have
peaked in some areas of the world. In China, where the virus outbreak started and is now
largely under control, demand appears to be returning, with data
showing crude oil imports rose 12% in March from a year earlier.
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CHART: U.S. oil may fall into $20.63-$21.45 range
Brent oil may retest support at $30.77 OPEC supply cuts Non-OPEC crude supply cuts ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>