BLBG: Oil Falls a Fourth Day After Unexpected Gasoline Supply Gain
July 1 (Bloomberg) -- Crude oil declined for a fourth day in New York after reports from the U.S. showed companies added fewer workers in June than forecast and an unexpected increase in gasoline stockpiles in the world's biggest energy consumer.
Oil dropped 0.4 percent yesterday, capping the first quarterly decline since 2008, as the U.S. Energy Information Administration reported gasoline inventories rose 537,000 barrels to 218.1 million last week. Companies added the smallest amount of workers since February, figures from ADP Employer Services showed.
"There's a lot of concerns about the pace of the U.S. economic recovery," said David Moore, a commodity strategist at Commonwealth Bank of Australia Ltd. in Sydney. "Sentiment is still relatively cautious. Some of the U.S. data flow was on the soft side of expectations, particularly the ADP employment report. The EIA data wasn't overly supportive of oil."
Oil for August delivery declined as much as 51 cents, or 0.7 percent, to $75.12 a barrel in electronic trading on the New York Mercantile Exchange. It was at $75.31 at 8:37 a.m. in Singapore. Yesterday, it dropped 31 cents to $75.63. Futures fell 9.7 percent in the second quarter and have lost 5 percent this year.
Crude oil stockpiles fell 2.01 million barrels last week, according to the report from the Energy Department. A drop of 1 million barrels was predicted in a Bloomberg News survey of analysts. Supplies of gasoline were forecast to decrease by 400,000 barrels.
Total fuel consumption declined 2.6 percent to 19 million barrels a day, the lowest level since April, the report showed.
U.S. Employment
The 13,000 workers added in June followed a revised 57,000 increase the prior month, ADP Employer Services said yesterday. Economists surveyed by Bloomberg News had forecast a gain of 60,000, according to the median estimate.
Companies may be slow to add workers until there's evidence the gains in demand will be sustained. Economists in a Bloomberg survey project a Labor Department report tomorrow will show payrolls fell this month due to a plunge in government employment of temporary workers conducting the census.
Hurricane Alex, the first June Atlantic hurricane since 1995, is prompting oil and gas companies in the Gulf of Mexico to evacuate offshore workers and prepare for possible storm surges that may disrupt production at coastal refineries. About 25 percent of crude production in the Gulf and 9 percent of natural-gas output has been halted, the U.S. government said.
Alex had maximum sustained winds of 85 miles (137 kilometers) an hour at 1 p.m. Houston time, according to a National Hurricane Center bulletin. It's heading for landfall in northeastern Mexico.
Brent crude oil for August delivery declined 43 cents, or 0.6 percent, to end the session at $75.01 a barrel on the London-based ICE Futures Europe exchange yesterday.