Crude in New York dropped as European officials said they plan to return to Greece next week to complete a review of the economy, bolstering the dollar and sending equities lower. Oil fell as much as 1.3 percent after the European Union said a “full mission” of officials from the European Central Bank, International Monetary Fund and EU will go to Athens. The American Petroleum Institute said yesterday U.S. oil stockpiles rose last week. An Energy Department report today will probably show a drop, according to a Bloomberg News survey. “There’s a lot going on and none of it bullish for oil,” said Addison Armstrong, director of market research at Tradition Energy in Stamford, Connecticut. “European politicians are unable to do anything to reassure the market, and putting off the review of Greece by a week is just the latest example. As a result equities are down and the dollar is looking better.” Crude oil for November delivery fell 55 cents, or 0.6 percent, to $86.37 a barrel at 9:25 a.m. on the New York Mercantile Exchange. Futures have increased 17 percent over the past year. Brent oil for November settlement rose 31 cents to $110.85 a barrel on the London-based ICE Futures Europe Exchange. The European benchmark’s premium to the West Texas Intermediate futures traded in New York widened to $24.48 from $23.62 at yesterday’s settlement. The dollar increased 0.2 percent to $1.3678 against the euro from $1.3702 yesterday. A stronger U.S. currency reduces the appeal of dollar-denominated raw materials as an investment. Debt Crisis The European debt crisis has generated as much as 300 billion euros ($410 billion) in credit risk for banks in the region, the IMF said today, calling for capital injections to reassure investors and support lending. Political squabbling over ways to fight contagion and delays in implementing measures previously agreed upon are raising concerns about the risk of defaults by governments, according to the Washington-based IMF. The API said U.S. crude oil supplies increased by 2.57 million barrels last week. The Energy Department report today will show that stockpiles declined by 1.3 million barrels, according to the median of 15 analyst responses in a Bloomberg News survey. The industry-funded API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey. The first North Sea Forties crude cargo for October loading was deferred, and a third September shipment was delayed to next month, according to a revised export program obtained by Bloomberg News. Forties is one of four North Sea crude grades used to price Dated Brent. To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net.

Source