* Japan Q2 GDP growth slower than expected, weighs on oil
* U.S. home builder, NY manufacturing data disappoint
* Weaker U.S. dollar limits oil's slip
* Coming up: API oil inventory data on Tuesday
(Recasts, updates prices, market activity, changes byline and
moves dateline from previous LONDON)
By Robert Gibbons
NEW YORK, Aug 16 (Reuters) - Oil slipped on Monday in
choppy trading as weak economic data in Japan and the United
States fed worries about the energy demand outlook, outweighing
support from a weaker dollar.
News that Japan's economy expanded by a mere 0.1 percent in
the second quarter, below forecasts, weighed on Asian equities
and was followed later by weak U.S. data.
A gauge of manufacturing in New York state rose in August
but the reading was below expectations. []
U.S. home-builder sentiment unexpectedly fell in August for
a third straight month to its lowest level in nearly 1-1/2
years, according to a National Association of Home Builders
survey on Monday. []
Separately, the New York Federal Reserve said its "Empire
State" general business conditions index increased to 7.10 in
August from 5.08 in July. But that was below the 8.00 expected
by economists polled by Reuters.
Oil prices drew some support as the dollar index <.DXY>
dropped, while the euro edged up against the greenback after
slipping to a one-month low in Asian trading. []
U.S. crude for September <CLc1> delivery fell 19 cents to
$75.20 a barrel at 12:07 p.m. EDT (1607 GMT). September crude
traded as low as $74.86, the lowest since July 13 and off an
early $75.95 peak.
Front-month ICE Brent crude <LCOc1> fell 27 cents to $74.84
a barrel.
"Economic woes and weaker equities are weighing on the
price," said Christopher Bellew, a broker at Bache Commodities.
"Rather than completely collapsing, oil is probably likely to
trade in a sideways pattern between around $74 and $78 basis
Brent."
Wall Street also saw choppy trading, with the technology
heavy Nasdaq leading a bargain hunter-led U.S. equities bounce
after a weak opening. []
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Graphic on oil's correlations with stocks and the dollar:
http://link.reuters.com/wyq35n
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Investors have grown more pessimistic about the outlook for
oil demand due to weak economic data and rising U.S. fuel
inventories, ample crude stocks and tepid demand. Last week,
oil prices fell 6 percent.
Rising gasoline stockpiles have sent U.S. gasoline futures
lower, and rising inventories also have pressured benchmark
distillate heating oil futures. Both were below $2 a gallon.
Still, European economic growth accelerated in the second
quarter of 2010 as Germany's best growth performance since
reunification helped offset for the struggles of Spain, Ireland
and recession-hit Greece.
In addition to economic indicators, oil markets continued
to eye tropical weather threats.
The remnants of Tropical Depression 5 strengthened in the
Gulf of Mexico and had a 60 percent chance of redeveloping into
a tropical depression over the next 48 hours, the U.S. National
Hurricane Center said on Monday. []
But producers have not cut back oil and natural gas
production in the northern Gulf of Mexico because of the
brewing tropical weather threat, operating companies said on
Monday morning. []
(Additional reporting by Alex Lawler in London and Alejandro
Barbajosa in Singapore, graphic by David Turner; Editing by
David Gregorio)
