Crude Oil Falls in New York Before Government Report on U.S. Inventories

Crude oil fell to its lowest price in seven weeks before a report forecast to show that U.S. inventories of crude increased as summer driving demand ebbs. The U.S. Energy Department will probably report today that crude stockpiles gained 300,000 barrels last week after three weeks of declines, a Bloomberg survey showed. Oil extended losses after the U.S. Commerce Department reported a smaller increase in durable goods orders than analysts had predicted.

“U.S. consumption is still very low; product inventories are sky-high,” said Tobias Merath, Zurich based head of commodity research at Credit Suisse Group AG. “In every market we’ve seen fears of a double dip recession and oil has been particularly affected.” Crude for October delivery declined as much as 53 cents, or 0.7 percent, to $71.10 a barrel, in electronic trading on the New York Mercantile Exchange, its lowest since July 6. It traded for $71.36 as of 1:38 p.m. London time. Brent crude for October delivery dropped 20 cents to $72.18 a barrel on the London based ICE Futures Europe Exchange.

Figures from the Commerce Department showed that bookings increased 0.3 percent, compared with the 3 percent median estimate of 75 economists surveyed by Bloomberg News. Excluding transportation equipment, demand unexpectedly fell. The Energy Department will issue its weekly report at 10:30 a.m. local time in Washington D.C. today. U.S. gasoline stockpiles probably declined 450,000 barrels in the week ended Aug. 20, based on the median estimate from 18 analysts surveyed.....Read the entire article.

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