Bloomberg News

Crude Oil Retreats From Three-Day High Before U.S. Supply Report

July 13, 2011

July 13 (Bloomberg) -- Oil fell from a three-day high in New York on speculation that growing U.S. supplies may signal slowing demand for fuel.

Futures reversed earlier gains as investors bet that stockpiles in the U.S. fell less than analysts predicted, after the American Petroleum Institute said yesterday crude inventories rose for the first time in six weeks. Analysts in a Bloomberg News survey had forecast supplies shrank before the Energy Department’s report today in Washington.

“Near-term direction will be down to the Energy Department statistics due out this afternoon,” Glen Ward, head of retail derivatives at London Capital Group Ltd., said in a note.

Crude for August delivery on the New York Mercantile Exchange was down 51 cents, or 0.5 percent, at $96.92 a barrel at 1:45 p.m. London time. It earlier rose as much as 53 cents $97.96, the highest price since July 7.

Brent oil for August settlement declined 66 cents to $117.09 a barrel on London’s ICE Futures Europe exchange. That took the European benchmark to a premium of $20.17 a barrel to U.S. futures, down from $20.32 at settlement yesterday and a record close of $22.29 on June 15.

The Energy Department today may say U.S. supplies dropped 1.5 million barrels, according to the median of 15 analyst estimates in a Bloomberg News survey.

Crude inventories climbed 2.3 million barrels last week to 359.4 million, the industry-funded American Petroleum Institute report showed yesterday.

--With assistance from Ann Koh and Christian Schmollinger in Singapore. Editors: John Buckley, Raj Rajendran

To contact the reporter on this story: Lananh Nguyen in London at lnguyen35@bloomberg.net

To contact the editor responsible for this story: Stephen Voss on sev@bloomberg.net


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