Oil declined for a second day in New York as investors bet that a slump in Chinese imports and rising unemployment in the U.S. indicated that fuel demand may falter in the world’s biggest crude-consuming nations. Futures slipped as much as 1 percent after China’s net oil imports shrank 10 percent in June to the lowest in eight months, according to Bloomberg calculations based on General Administration of Customs data released yesterday. Prices also dropped after the Labor Department said on July 8 that employers added the fewest workers in nine months and the unemployment rate unexpectedly rose to the highest this year. “We have a confluence of factors today, weak U.S. payroll data, Italian bank concerns and the Chinese trade data,” said Serene Lim, a commodity strategist with Australia & New Zealand Banking Group Ltd. in Singapore. “China’s imports declined month on month but it was rather due to seasonal factors from the impact of maintenance.” Crude for August delivery fell as much as 98 cents to $95.22 a barrel in electronic trading on the New York Mercantile Exchange, and was at $95.45 at 3:03 p.m. Singapore time. The contract dropped $2.47, or 2.5 percent, to $96.20 on July 8. Prices are 27 percent higher the past year. Brent oil for August settlement decreased 70 cents, or 0.6 percent, to $117.63 a barrel on the London-based ICE Futures Europe exchange. The European benchmark contract was at a premium of $22.22 to U.S. futures. The difference reached a record $22.29 on June 15. Demand Restrained Concern that Italy may be the next European country to deal with a debt crisis pushed banking equities, causing the overall stock market there down by 3.5 percent on July 8. U.S. payrolls increased by 18,000 in June, the Labor Department data showed. The median estimate in a Bloomberg News survey called for a gain of 105,000. “The one thing that’s going to restrain the demand recovery is this very high unemployment rate,” said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne, who predicts oil in New York will average $113 a barrel in the third quarter. “It dims the outlook on the second half of the year for demand.” 50-Day Moving Average Oil prices may extend declines in New York after failing to breach the 50-day moving average last week, according to data compiled by Bloomberg. “Strength above the 50-day moving average of $98.80 should send the bulls towards our $101.20 inflection high,” Stephen Schork, president of the Schork Group Inc. energy advisory company in Villanova, Pennsylvania, said in a daily report e- mailed today. “All eyes will be on Thursday’s retail sales.” A report this week may show sales at U.S. retailers stagnated in June. Commerce Department data on July 14 may indicate an unchanged reading in purchases after a 0.2 percent May decrease, according to the median forecast in a Bloomberg News survey. U.S. payrolls increased by 18,000 in June, the Labor Department data showed July 8. The median estimate in a Bloomberg News survey called for a gain of 105,000. China imported 19.7 million tons and exported 270,000 tons of crude, customs data showed. Net imports of fuel, including gasoline and diesel, rose to 1.36 million tons last month from 930,000 tons in May, according to the data. Net purchases reached a 29-month high of 2.07 million tons in December, the data show. Some refineries in China, including PetroChina Co.’s largest facility at Dalian in the northeast, shut for routine maintenance in June, leading to a decline in demand for crude. About 600,000 barrels a day of capacity were taken offline last month, Brynjar Eirik Bustnes, a Hong Kong-based analyst at JPMorgan Chase & Co., said yesterday. Net-long bets on crude gained by 12,343 futures and options combined, or 8.1 percent, to 165,491, in the seven days ended July 5, according to the Commodity Futures Trading Commission’s Commitments of Traders report. To contact the reporters on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net; Christian Schmollinger in Singapore at christian.s@bloomberg.net To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

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