By Mark Shenk Nov. 5 (Bloomberg) -- Crude oil fell more than $5 a barrel after an Energy Department report showed an unexpected increase in gasoline inventories. Gasoline supplies rose 1.12 million barrels to 196.1 million barrels last week, the report showed. A 650,000-barrel drop was forecast, according to the median of 14 analysts surveyed by Bloomberg News. Stockpiles of crude oil and distillate fuel, a category that includes heating oil and diesel, also rose. ``There is plenty of inventory, given how weak demand is,'' said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. ``The report was mildly bearish because of the product numbers.'' Crude oil for December delivery fell $5.07, or 7.2 percent, to $65.46 a barrel at 11:45 a.m. on the New York Mercantile Exchange. Prices, which have tumbled 56 percent since reaching a record $147.27 on July 11, are down 30 percent from a year ago. U.S. fuel demand during the past four weeks averaged 19.1 million barrels a day, down 6.7 percent from a year ago, the report showed. Gasoline consumption over the period was down 2.3 percent at 9 million barrels a day. Futures rose $6.62, or 10 percent, to $70.53 a barrel yesterday, the largest one-day gain since Sept. 22, as U.S. stock markets recorded the biggest presidential-election day rally since Ronald Reagan won a second term 24 years ago. Distillate inventories rose 1.21 million barrels to 127.8 million barrels last week. Analysts forecast that supplies would increase by 1.55 million barrels. Crude oil stockpiles climbed 54,000 barrels to 311.9 million barrels in the week ended Oct. 31, the department said. A 1 million-barrel gain was forecast. Imports dropped 365,000 barrels to 9.97 million barrels. The department released its weekly report today at 10:35 a.m. in Washington. Economic Concerns Prices also fell because of concern that the economy of the U.S., the world's biggest energy consumer, will continue to contract. Companies in the U.S. cut an estimated 157,000 jobs in October, the most in almost six years, a private report based on payroll data showed today. The drop was larger than forecast and followed a revised 26,000 decrease in September that was bigger than previously estimated, ADP Employer Services said. The decline in employment was the biggest since November 2002, when the U.S. was emerging from a recession. The Institute for Supply Management's non-manufacturing index, which covers almost 90 percent of the economy, dropped to 44.4 from 50.2 in September, the Tempe, Arizona-based group said today. A reading of 50 is the dividing line between growth and contraction. Brent crude oil for December settlement declined $5.01, or 7.5 percent, to $61.43 a barrel on London's ICE Futures Europe exchange. To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net.

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