Crude Oil Little Changed Near $71 After U.S. Fuel Supplies Drop

June 11 (Bloomberg) -- Oil was little changed after rising to a seven-month high on a government report that showed U.S. crude and gasoline stockpiles unexpectedly fell and fuel supplies declined.

Stockpiles of oil dropped 4.38 million barrels to 361.6 million in the week ended June 5, the Energy Department said yesterday. Analysts surveyed by Bloomberg News said supplies would rise by 100,000 barrels. Gasoline inventories slipped for a seventh week.

“The big news last night was the bigger than expected decline in stockpiles,” said Toby Hassall, a research analyst at Commodity Warrants Australia Pty in Sydney. “That’s somewhat of a fundamental justification for this rally continuing in the short term.”

Crude oil for July delivery gained 13 cents to $71.46 a barrel at 10:05 a.m. Sydney time in after-hours trading on the New York Mercantile Exchange. Yesterday, the contract rose $1.32, or 1.9 percent, to close at $71.33, the highest settlement since Oct. 20.

Oil stockpiles are 11 percent higher than the five-year average, down from a 27 percent surplus two weeks earlier, the Energy Department said. Inventories climbed to 375.3 million during the week ended May 1, the highest since 1990.

Stockpiles of gasoline fell 1.55 million barrels to 201.6 million, the report showed. A 750,000-barrel increase was forecast, according to the median of 14 estimates by analysts surveyed before today’s report.

Fuel Demand

U.S. fuel demand in the past four weeks averaged 18.3 million barrels a day, down 6.9 percent from a year earlier, the Energy Department said. There was a 7.7 percent deficit in the week ended May 29. Gasoline use averaged 9.2 million barrels a day during the period, up 0.4 percent from a year ago.

Fuel imports dropped 379,000 barrels a day to 2.55 million, the department said. Crude-oil imports slipped 676,000 barrels to 8.97 million.

Gasoline supplies last week were 3.9 percent below the five-year average for the period, according to the department. There was a 13 percent surplus in the week ended May 22.

Gasoline for July delivery gained 0.47 cents to $2.0200 a gallon at 10:07 a.m. in Sydney. Yesterday, it rose 4.86 cents, or 2.5 percent, to $2.0153 a gallon in New York, the highest close since Oct. 9.

Commodity futures have increased this year as the dollar weakened and equity markets rebounded. Energy and metals usually climb when the U.S. currency declines as investors seek alternative investments.

Dollar to Weaken

Investors worldwide predict that the dollar will weaken as demand for better-yielding assets increases amid rising confidence in the global economy, according to 2,410 respondents worldwide in the Bloomberg Professional Global Confidence Index.

The dollar traded at $1.3983 per euro as of 8:07 a.m. in Tokyo from $1.3984 yesterday in New York.

The Organization of Petroleum Exporting Countries will only consider increasing output when the price of crude rises to $100 a barrel, according to Kuwaiti Oil Minister Sheikh Ahmed al- Abdullah al-Sabah. OPEC is scheduled to meet on Sept. 9.

Oil at between $60 and $90 a barrel is in “the right sort of price range” to ensure future investment, BP Plc’s Chief Executive Officer, Tony Hayward, said at a presentation in London yesterday.

Global oil reserves totaled 1.258 trillion barrels at the end of 2008, down from a revised 1.261 trillion a year earlier, BP said in its annual Statistical Review of World Energy posted on its Web Site yesterday.

Brent crude for July delivery rose $1.18, or 1.7 percent, to close at $70.80 a barrel on London’s ICE Futures Europe exchange. It was the highest settlement since Oct. 20.