By Mark Shenk (Corrects direction of supply change in headline.) July 22 (Bloomberg) -- Crude oil declined for the first time in six days after an industry report showed that supplies rose in the U.S., the world’s biggest energy-consuming country. U.S. stockpiles climbed 3.1 million barrels last week, the first increase since April, an American Petroleum Institute report showed late yesterday. Gasoline inventories rose to the highest level since April. An Energy Department report today is forecast to show that crude inventories fell as fuel supplies increased, according to a Bloomberg News survey. “The API report showed big builds in crude oil and gasoline, which is a sign that there’s just not a lot of demand out there,” said Phil Flynn, vice president of research at PFGBest, a Chicago-based brokerage. “Both seasonal and technical figures should weigh on this market. It’s going to be hard to sustain rallies because of the burdensome stockpiles.” Crude oil for September delivery dropped $1.09, or 1.7 percent, to $64.52 a barrel at 9:05 a.m. on the New York Mercantile Exchange. The August contract expired at $64.72 a barrel yesterday. Prices are up 45 percent this year. Oil climbed 8.7 percent from July 14 to July 21 as investors bought futures on expectations of higher fuel demand. Optimism that the worst of the global recession is over followed gains in U.S. leading economic indicators and improved earnings among financial service companies. Gasoline inventories rose 1.33 million barrels to 213.6 million, the API report showed. The industry-funded group also reported that refinery utilization fell to 84 percent of capacity from 86 percent. Next Release The Energy Department is scheduled to release its Weekly Petroleum Status Report today at 10:30 a.m. in Washington. Oil- supply figures from the institute and the Energy Department moved in the same direction for the previous six weeks and 76 percent of the time in the past four years, according to data compiled by Bloomberg. The department’s report will probably show that crude inventories declined 2.1 million barrels in the week ended July 17, according to the median of 15 estimates by analysts surveyed by Bloomberg News. Gasoline supplies increased 650,000 barrels last week, according to the analyst survey. Stockpiles of distillate fuel, a category that includes diesel and heating oil, rose 1.5 million barrels, the survey showed. Brent crude for September settlement declined 80 cents, or 1.2 percent, to $66.07 a barrel, on the London-based ICE Futures Europe Exchange. To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net

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