Oil fell, paring its sixth weekly increase as some traders called recent gains excessive because of doubts the global economic slump is nearing an end. Goldman Sachs Group Inc. said oil’s rally is vulnerable to a correction as demand remains constrained. U.S. crude stockpiles rose to the highest since July 1993 last week, indicating limited fuel demand in the world’s largest economy. The dollar strengthened against the euro today, limiting the appeal of commodities to hedge against inflation. “It’s too early to say we have a recovery,” said Gerrit Zambo, an oil trader at BayernLB in Munich. “We need to see what the economy does in the next few months. We could easily see a correction below $50 again.” Crude oil for May delivery declined as much as $1.52, or 2.8 percent, to $52.82 a barrel on the New York Mercantile Exchange. It was at $53.20 a barrel at 12:30 a.m. London time. Oil futures have jumped 36 percent in the five weeks through March 20. Crude is set for its sixth consecutive week of gains on signs of an economic recovery in the U.S., the world’s biggest oil consumer, where new home sales increased last month and durable goods orders rose. The discount for crude delivered in May, the front-month contract in New York, compared with July futures widened to as much as $3.47 a barrel this week from $1.18 earlier in the month. That indicates a surplus of oil for immediate delivery. ‘Market Vulnerable’ “The current rally was accompanied by weakened time- spreads and weaker fundamentals,” Jeffrey Currie, a London- based analyst at Goldman, said in the bank’s Energy Weekly report yesterday. “This leaves the market vulnerable to near- term pullback.” U.S. oil supplies rose 3.3 million barrels to 356.6 million in the week ended March 20. It was the 22nd gain in 26 weeks and left stockpiles 13 percent higher than the five-year average for the period. Crude oil stockpiles at Cushing, Oklahoma, where New York- traded West Texas Intermediate crude is delivered, fell 2.21 million barrels to 31.7 million last week. Consumption of fuels rose 2.2 percent to 19.2 million barrels a day last week, the Energy Department report showed. Daily fuel demand averaged over the past four weeks was 19.1 million barrels, down 3.2 percent from a year earlier. The dollar rose to $1.3326 to the euro as of noon in London from $1.3526 yesterday in New York and $1.3582 on March 20 after a report showing the U.K. economy shrank more than forecast last year added to concern the global financial turmoil is deepening, stoking demand for the currencies as a refuge. Brent crude oil for May settlement fell as much as $1.25 cents, or 2.3 percent, to $52.21 a barrel on London’s ICE Futures Europe exchange. It traded at $52.48 at 12:30 p.m. London time.

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