Crude oil advanced in New York as rising equity markets and forecasts of declining U.S. inventories signaled growing demand for fuel. European stocks gained for a sixth day, with the Europe Stoxx 600 index rising 1.6 percent. The U.S. Energy Department may say tomorrow that crude stockpiles fell last week, and the International Energy Agency predicted higher demand for oil next year. The dollar narrowed its gains against the euro, making the commodity cheaper for European investors. “The correlation between oil and stock markets is strong at the moment,” Roland Stenzel, a crude and carbon trader at E&T Energie Handelsgesellschaft mbH, said from Vienna. “Company earnings will show us whether the economy is improving and whether oil demand will rise.” Crude for August delivery rose 49 cents, or 0.7 percent, to $75.44 a barrel in electronic trading on the New York Mercantile Exchange as of 10:34 a.m. London time. Yesterday, the contract dropped $1.14 to $74.95, the lowest settlement since July 7. Prices have declined 4.9 percent this year. Brent crude for August gained 69 cents, or 0.9 percent, to $75.06 a barrel on the London-based ICE Futures Europe exchange. Brent may surpass this year’s high of $89.58 a barrel after prices rebounded against a rising channel formation, according to analysis by Standard Chartered Plc. The August Brent contract fell as low as $73.85 a barrel yesterday, after gaining 5.3 percent last week. The commodity is set to rise toward $83 after declines in the past two months failed to extend below a channel that has bound prices for the past year, indicating a long-term rising trend is still intact, Standard Chartered said in an e-mailed report yesterday. IEA Report Global oil demand will increase 1.6 percent in 2011 on economic growth in emerging markets, the International Energy Agency said, giving its first forecast for next year. Demand will grow faster than refiners can add new plants in the two years to 2011, reducing the current surplus in processing capacity, the Paris-based adviser to oil-consuming nations said. The U.S. Energy Department will release weekly figures on crude oil and product inventories tomorrow. Crude supplies probably fell last week amid expectations refiners will boost output and imports declined, according to a Bloomberg News survey. Oil supplies probably dropped 1.35 million barrels in the seven days ended July 9, according to the median estimate of 10 analysts surveyed by Bloomberg News. The Energy Department is scheduled to release its weekly report at 10:30 a.m. tomorrow in Washington. To contact the reporter on this story: Rachel Graham in London rgraham13@bloomberg.net Ann Koh in Singapore at akoh15@bloomberg.net

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