By Mark Shenk March 23 (Bloomberg) -- Crude oil fell as the dollar climbed against the euro and analysts forecast that a government report will show a gain in U.S. stockpiles. Oil dropped as much as 0.9 percent after the greenback increased on skepticism European Union leaders will agree on an aid package for Greece this week. A stronger U.S. currency reduces the need for commodities as an alternative investment. An Energy Department report tomorrow will probably show that supplies rose an eighth week, a Bloomberg News survey showed. “We are locked in a trading range, and what occurs on any given day is due to the dollar,” said Phil Flynn, vice president of research at PFGBest in Chicago. “Supply and demand are no longer the primary movers of this market.” Crude oil for May delivery fell 48 cents, or 0.6 percent, to $81.12 a barrel at 9:53 a.m. on the New York Mercantile Exchange. Prices are up 2.2 percent this year. The dollar traded at $1.3505 per euro, up 0.4 percent from $1.3558 yesterday. The euro weakened versus 12 of 16 major counterparts after European Central Bank President Jean-Claude Trichet spoke out against offering the low-interest loans to the Greek government. Oil prices have remained within a $68- to $84-a-barrel range since October, and have traded between $77.05 and $83.16 over the past month. “Oil is tracking the dollar,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “We’re finding out the market can’t move too far above $80 before running into resistance. There will have to be evidence of increasing demand or a geopolitical crisis to push prices above $83.” U.S. Inventories Stockpiles of crude oil rose 1.43 million barrels last week, according to the median of 14 analyst estimates in a Bloomberg News survey. The Energy Department is scheduled to release its weekly report at 10:30 a.m. in Washington tomorrow. Brent crude for May settlement declined 37 cents, or 0.5 percent, at $80.17 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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