Crude oil fell for a third day on signs that a slowing recovery in the U.S. will curtail fuel consumption in the world’s second-largest energy user. The industry-funded American Petroleum Institute said yesterday that inventories of crude oil, gasoline and distillate fuels such as diesel grew last week. The Energy Department will issue its report for the same period today. American consumer confidence fell in July, shaken by mounting concern over jobs and wages that threatens to constrain the economic recovery, according to the Conference Board. “It’s macroeconomic news and fears of a double-dip that will drive sentiment,” said Christophe Barret, an oil analyst with Credit Agricole CIB in London. “The API numbers were not very supportive, with an increase in crude stocks that was not expected and small increases in gasoline and distillates, so now we’re waiting for confirmation from the Energy Department.” Crude for September delivery was at $77.27 a barrel, down 23 cents, in electronic trading on the New York Mercantile Exchange at 12:07 a.m. London time. The contract dropped as much as 62 cents earlier, or 0.8 percent, to $76.88. Brent crude for September settlement on the London-based ICE Futures Europe fell 17 cents to $75.97. ‘Improving Risk Appetite’ “It’s a mix of the reporting season and macroeconomic indicators that is driving the market,” said Thina Saltvedt, a commodities analyst at Nordea Bank AB in Oslo. “Some companies are reporting good second-quarter results, and that’s improving risk appetite. The oil market is still improving, but it’s going slowly.” The U.S. Energy Department report at 10:30 a.m. in Washington may show oil inventories declined to a four-month low, falling 1.73 million barrels from 353.5 million, based on the median estimate from 16 analysts in a Bloomberg News survey. Gasoline and distillate supplies are expected to have increased, the survey showed. U.S. crude inventories rose to 356.3 million barrels in the week ended July 23, the highest in four weeks, according to the American Petroleum Institute report. Crude remains in a rising channel on technical charts and will continue to face resistance near $80 a barrel, according to Societe Generale SA. Oil for September delivery in New York will be capped at the 50 percent Fibonacci retracement of the contract’s drop in May, said Stephanie Aymes, a cross-commodity technical analyst at France’s second-largest bank by market value. This is in a band near $80.82 a barrel, where a rally from below $70 stalled on June 21. To contact the reporters on this story: Grant Smith in London at gsmith52@bloomberg.net

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