Crude oil fell for a second day in New York after Chinese equities declined and as a stronger dollar reduced the investment appeal of commodities. Oil dropped below $75 a barrel in New York after China quashed speculation that policy makers will relax measures aimed at cooling the economy. The dollar rose against the euro for a third day. U.S. gasoline inventories probably gained 350,000 barrels last week, poised for the third consecutive increase after seven weeks of declines, according to analysts surveyed by Bloomberg News before a government report tomorrow. “There seems to be more negative news that investors are reacting to,” said Serene Lim, a Singapore-based energy and commodity strategist at Australia & New Zealand Banking Group Ltd. “Sentiment is a bit jittery, quite bearish, and oil prices could reach the $67 to $72 a barrel range by the end of the month.” Crude for August delivery fell as much as 64 cents, or 0.9 percent, to $74.31 a barrel in electronic trading on the New York Mercantile Exchange. It was at $74.59 a barrel at 3:19 p.m. Singapore time. Yesterday, the contract dropped $1.14 to $74.95, the lowest close since July 7. Prices have declined 6.3 percent this year. The dollar traded at $1.2555 per euro at 2:59 p.m. Singapore time, from $1.2596 in New York yesterday. The euro has lost 1.1 percent since July 8. A stronger U.S. currency makes it more expensive for investors to buy commodities priced in the dollar. The Shanghai Composite Index dropped 1.8 percent to 2,445.19 as of 12:30 p.m., the most since June 29. The CSI 300 Index fell 2 percent to 2,623.70. Property Curbs China’s Ministry of Housing and Urban-Rural Development reiterated that it will maintain curbs on speculative purchases and increase market supply. The statement was in response to media reports that the nation may abandon its current property policies, it said. Brent crude for August settlement fell as much as 68 cents, or 0.9 percent, to $73.69 a barrel on the London-based ICE Futures Europe exchange, and traded at $74 at 3:22 p.m. Singapore time. Yesterday, the contract dropped $1.05, or 1.4 percent, to $74.37. “In the short term, there’s lot of headwinds against oil to move significantly above the marginal cost, which we see at $70 a barrel,” said Neil Beveridge, an analyst at Sanford C. Bernstein Ltd. in a Bloomberg Television interview in Hong Kong. U.S. crude supplies probably fell last week as refiners are expected to boost output and imports declined, according to a Bloomberg News survey. Oil supplies probably dropped 1.35 million barrels in the seven days ended July 9, according to the median estimate of 10 analysts surveyed by Bloomberg News. Stockpiles of distillate fuel, a category that includes heating oil and diesel, probably climbed 800,000 barrels from 159.7 million, according to the survey. All of the respondents forecast a gain. The Energy Department is scheduled to release its weekly report at 10:30 a.m. tomorrow in Washington. To contact the reporter on this story: Ann Koh in Singapore at akoh15@bloomberg.net

Source