July 15 (Bloomberg) -- Crude oil fell for a second day after China’s economic growth eased and the Federal Reserve said the U.S. outlook has “softened,” adding to concern fuel demand will slow in the world’s two biggest energy consumers.
Oil declined as Asian stocks dropped from a three-week high, following a pullback in U.S. equities. China, the second-largest energy user, posted growth of 10.3 percent in the quarter ended June, down from 11.9 percent in the first three months of the year, signaling a deeper second-half slowdown that may add to risks for the global economy.
“There are a growing number of indicators that point to a slowing U.S. economy,” said David Land, chief market analyst at CMC Markets Ltd. in Sydney. “The Federal Reserve’s revised assessment of the economy and weaker-than-expected retail sales figures put a dampener on things.”
Crude for August delivery fell as much as 54 cents, or 0.7 percent, to $76.50 a barrel in electronic trading on the New York Mercantile Exchange. It was at $76.66 at 2:38 p.m. Singapore time. Yesterday, the contract slipped 11 cents to settle at $77.04 after reaching $78.15, the highest intraday price since June 29.
U.S. retail sales dropped 0.5 percent in June, easing for a second month, the Commerce Department said yesterday. A report today may show June industrial production declined, based on a Bloomberg News survey of economists.
Inflation in China, Asia’s second-largest economy after Japan, cooled to 2.9 percent in June and industrial output rose less than estimated, the statistics bureau said today. The data indicated the government succeeded in measures to temper growth and offered Premier Wen Jiabao more room to scale back restrictions on bank lending in coming months.
Oil has lost 3.5 percent this year amid speculation rising supplies in the U.S. signaled a slowdown in consumption.
Fuel demand dropped 4 percent to 18.8 million barrels a day in the week ended July 9, the biggest one-week decline since March, according to data from the Energy Department yesterday.
Gasoline stockpiles climbed for a third week as production jumped to a record 9.51 million barrels a day. Stockpiles reached 221 million barrels, 4.3 percent above the five-year average, the report showed.
Commercially held crude inventories fell 5.06 million barrels to 353.1 million, the biggest drawdown since September, the department said. Refineries boosted utilization to 90.5 percent of capacity, the highest rate since January 2008.
Stockpiles of distillate fuel, including heating oil and diesel, increased 2.9 million barrels to 162.6 million, 24 percent above the five-year average.
Brent crude for August settlement on the London-based ICE Futures Europe exchange fell as much as 58 cents, or 0.8 percent, to $76.19 a barrel. It was at $76.35 at 2:36 p.m. Singapore time. The contract, which expires today, gained 12 cents yesterday to settle at $76.77. The more actively traded September future was down 43 cents at $76.23.
To contact the editor responsible for this story: Clyde Russell in Singapore at firstname.lastname@example.org