By Alexander Kwiatkowski Oct. 15 (Bloomberg) -- Oil fell below $77 a barrel on speculation a U.S. plan to invest $250 billion in banks will be insufficient to avoid recession and boost fuel demand. Oil, which has followed movements in equity markets this month as the credit crisis deepened, fell as European stocks dropped today. The International Energy Agency and the U.S. Energy Department have cut their global oil demand forecasts for next year as the worst financial turmoil since the 1930s may lead to a global recession. ``The world is in for a very torrid couple of years that are going to hit industrial demand and oil demand,'' said Peter Luxton, a London-based energy analyst at Informa Global Markets. ``The global bearish sentiment is dominating.'' Crude oil for November delivery fell as much as $2.58, or 3.3 percent, to $76.05 on the New York Mercantile Exchange. It traded at $76.43 a barrel at 12:36 p.m. London time. Prices, down 11.3 percent from a year ago, have dropped 47 percent from the record $147.27 a barrel on July 11. A government report tomorrow may show that U.S. crude-oil and gasoline inventories rose last week, according to the median of responses by analysts in a Bloomberg News survey. The report will be released a day late because of the Columbus Day federal holiday Oct. 13 in the U.S. Brent crude oil for November settlement fell as much as $2.60, or 3.5 percent, to $71.93 a barrel on London's ICE Futures Europe exchange. It traded at $72.38 at 12:32 p.m. local time. The November Brent contract expires tomorrow. The more- active December futures were at $74.30 a barrel, down $2.08, at 12:32 p.m. London time. Fuel Consumption U.S. fuel demand averaged about 18.7 million barrels a day during the four weeks ended Oct. 3, the lowest since June 1999, according to an Energy Department report on Oct. 8. The U.S. consumes 24 percent of the world's oil. ``Most global economies accept that recession is now a probability,'' said Robert Laughlin, senior broker at MF Global Ltd. in London. ``Even China's growth prospects remain the focus of constant debate.'' Hurricane Omar strengthened from a tropical storm over the Caribbean south of Puerto Rico and U.S.-based forecasters say it may strike the Virgin Islands as early as today. Omar's sustained winds increased to almost 75 miles (120 kilometers) per hour from 50 mph, the U.S. National Hurricane Center said in an advisory at 11 p.m. Puerto Rico time yesterday. Omar was 315 miles south-southwest of San Juan in Puerto Rico and moving northeast at 6 mph. Restoring Production Energy producers are still restoring oil production in the U.S. Gulf Of Mexico after platforms were shut down because of hurricanes Gustav and Ike. Producers have resumed about 61 percent of oil output and 63 percent of natural-gas output, the U.S. Minerals Management Service said in a statement on its Web site. The Gulf of Mexico accounts for 26 percent of U.S. oil production and 14 percent of gas output. The Gulf normally produces about 1.3 million barrels of oil and 7.4 billion cubic feet of gas a day, according to the Minerals Management Service, which is part of the U.S. Interior Department. -- With reporting by Christian Schmollinger in Singapore Editors: Will Kennedy, Amanda Jordan. To contact the reporters on this story: Alexander Kwiatkowski in London at akwiatkowsk2@bloomberg.net

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