Oil declined, trimming the biggest weekly gain in almost three months, as signs of slowing manufacturing growth in China and the U.S., the world’s biggest energy users, stoked speculation fuel demand may falter. Futures slipped as much as 0.9 percent, dropping for the first day in four, after China’s Purchasing Managers’ Index fell to the lowest since February 2009. A report today may show a slowdown in U.S. factory activity. Prices also slid as the U.S. offered 30 million barrels of oil from strategic reserves under an International Energy Agency plan to stabilize prices and OPEC boosted supplies. China’s report “affirms their tightening of monetary policy is taking effect and impacting oil demand,” said Serene Lim, a commodity strategist at Australia & New Zealand Banking Group Ltd. in Singapore. “China is where the growth is and having this kind of manufacturing activity data slowing down might be affecting the markets.” Futures for August delivery declined as much as 90 cents to $94.52 a barrel in electronic trading on the New York Mercantile Exchange and was at $94.65 at 2:27 p.m. Singapore time. The contract yesterday rose 65 cents, or 0.7 percent, to $95.42. Prices are up 30 percent the past year and 4 percent this week. Brent oil for August settlement slid 88 cents, or 0.8 percent, to $111.60 on the London-based ICE Futures Europe exchange. The European benchmark contract traded at a premium of $16.95 to New York-traded West Texas Intermediate. The spread reached a record $22.29 a barrel on June 15. China Slowdown China’s Purchasing Managers’ Index was at 50.9 in June compared with 52 in May, the China Federation of Logistics and Purchasing said in an e-mailed statement today. The median forecast in a Bloomberg News survey of 13 economists was 51.5. A reading above 50 indicates expansion. A report today may show U.S. manufacturing also slowed last month. The Institute for Supply Management’s factory index fell to 52 from 53.5 in May, according to the median estimate of 77 economists in a Bloomberg survey. Oil dropped early yesterday after the Labor Department reported that U.S. jobless claims fell less than expected in the week ended June 25. Claims slid by 1,000 to 428,000, compared with the median forecast of economists in a Bloomberg News survey of a drop to 420,000. IEA Release IEA members will release 60 million barrels of oil from strategic reserves over 30 days beginning at the end of this week to make up for a Libyan production shortfall and curb high prices, the agency said June 23. Half the crude will come from the U.S. Strategic Petroleum Reserve. The U.S. offered light, sweet crude as part of the release. More than “90 offers to purchase oil were received” on June 29, the Energy Department said yesterday. Contracts will be completed by July 11, the agency said. The administration will continue to monitor oil supply and is prepared to act further, according to a government official. The Organization of Petroleum Exporting Countries’ production rose by an average 210,000 barrels a day in June to 29.105 million, the highest since February, a Bloomberg News survey of oil companies, producers and analysts showed. Saudi Arabia increased crude output by 3.2 percent to a 32-month high. Daily output by the 11 members with quotas, all except Iraq, climbed 180,000 barrels to 26.4 million, 1.555 million barrels above their target. Oil Survey Oil futures will probably fall next week amid signals that the economy is slowing as the first oil from strategic reserves enters the market, a Bloomberg News survey showed. Fourteen of 36 analysts, or 39 percent, forecast oil will drop through July 8. Eight respondents, or 22 percent, predicted prices will increase and 14 estimated there will be little change. Last week, 44 percent of those surveyed said futures would drop. August oil in New York faces resistance at about $96.05, the 200-day moving average, and $96.20, the middle of a Bollinger chart, according to Addison Armstrong, director of market research at Tradition Energy in Stamford, Connecticut. Brent may decline to $102.25 a barrel after forming double- top and head-and-shoulders chart patterns, according to technical analysis by Andy Riddell, head of retail derivatives at London Capital Group Holdings Plc. To contact the reporters on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net; Ann Koh in Singapore at akoh15@bloomberg.net To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

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