Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

ExxonMobil (NYSE:XOM) and the energy sector are leading the S&P 500 (SNPINDEX:^GSPC) down today as oil prices drop on increasing stockpiles around the world. As of 1:30 p.m. EDT, the S&P 500 is down nine points to 1,745, and the largest exchange-traded fund tracking the S&P 500, the SPDR S&P 500 (NYSEMKT:SPY), is down 0.4% to $175.12.

Yesterday, U.S. oil prices dropped as the American Petroleum Institute estimated that crude-oil inventories in the nation climbed by 3 million barrels last week. Oil prices dropped further today after the Energy Information Administration released its Weekly Petroleum Status Report.

The report showed that U.S. stockpiles, excluding the Strategic Petroleum Reserve, increased by 5.2 million barrels to 379.8 million barrels, a 10-year seasonal high. The large growth in stockpiles was well above the API's estimate and notably higher than analysts' expectations of a 1.8 million-barrel addition to stockpiles. Internationally, Xinhua reported that Chinese crude-oil inventories increased by 1.4% to their highest levels since 2010.

With supplies unexpectedly increasing in the two largest oil-consuming markets in the world, oil prices dropped. In the U.S., West Texas Intermediate crude was down 1.5% to $96.82. Internationally, Brent crude was down 1.6% to $108.22. Brent crude is relatively unchanged over the past three months, but the continuing increase in U.S. supplies has oil prices at home down nearly 8% over that period.

The steep drop in oil prices is pulling the oil majors lower today, with ExxonMobil down 0.8%, Chevron (NYSE:CVX) down 0.3%, and this year's top-performing oil and gas stock, ConocoPhilips (NYSE:COP), down 1.6%. Predicting oil prices is a fool's game (with a lowercase "F"). In the short term, anything can happen. Heck, even in the medium and long term, anything can happen with oil prices. That said, two main factors are pointing to lower prices:

  1. Slowing growth around the world.
  2. Increasing supply. Whether that's from higher U.S. production, larger oil exports from Iran as sanctions lift, or increased production from Iraq, oil production is increasing.

Oil prices look likely to drop so long as we continue to have a relatively stable political environment around the world, and oil majors will drop with them.

Dan Dzombak can be found on Twitter @DanDzombak or on his Facebook page, DanDzombak. He has no position in any stocks mentioned. The Motley Fool recommends Chevron. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.