Oil Falls From Seven-Week High on Forecast for Inventory Gain

Oct. 13 (Bloomberg) -- Oil fell from a seven-week high in New York on forecast of an increase in U.S. crude stockpiles, bolstering skepticism about the pace of recovery in the biggest energy-consuming nation.

Oil pared yesterday’s 2.1 percent gain before an Energy Department report that may show U.S. crude-oil inventories climbed 1 million barrels last week, according to the median of 11 analyst responses in a Bloomberg News survey.

“Crude oil supply is well above the five-year average,” said Mark Pervan, a senior commodity strategist at ANZ Banking Group Ltd. in Melbourne.

Crude oil for November delivery dropped as much as 44 cents, or 0.6 percent, to $72.83 a barrel, in electronic trading on the New York Mercantile Exchange, and traded at $72.94 at 10:40 a.m. Singapore time. Yesterday, the contract rose $1.50 to $73.27, the highest settlement since Aug. 24. Prices are up 63 percent this year.

U.S. refiners often idle units for repairs and upgrades in October as gasoline demand drops and before heating-oil use rises. Crude-oil imports fell 4.6 percent to 9.1 million barrels a day in the week ended Oct. 2.

“When you look at the supply backdrop, it is pretty large in the U.S.,” Pervan said. “U.S. inventory data, for me, is probably going to be weak” this week, he said.

Fuel Supplies

Supplies of distillate fuel, a category that includes heating oil and diesel, declined 200,000 barrels from 171.8 million the prior week, according to the survey. Stockpiles in the week ended Oct. 2 were at the highest level since January 1983. Six of the respondents predicted a decline and five said there was a gain.

Gasoline stockpiles probably rose 1.5 million barrels, the survey showed. The Energy Department is scheduled to release its weekly report on Oct. 15 at 11 a.m. in Washington, a day later than usual because of the Columbus Day holiday.

The Standard & Poor’s 500 Index advanced 0.4 percent to 1,076.19 in New York yesterday, above its highest close since Oct. 3, 2008. The Dow Jones Industrial Average rose 0.2 percent. The MSCI World Index of 23 developed nations climbed 0.5 percent to its highest closing level since Oct. 1, 2008.

Australia’s benchmark S&P/ASX 200 Index gained 0.9 percent at 1:01 p.m. Sydney time.

Brent crude oil for November settlement declined as much as 52 cents, or 0.7 percent, to $70.84 a barrel on the London-based ICE Futures Europe exchange, and was at $71.12 at 10:37 a.m. Singapore time. Yesterday, the contract rose $1.36, or 1.9 percent, to end the session at $71.36.