* U.S. crude inventories jump 7.5 million barrels - API
* Investors await EU summit Thursday
* Euro zone data paints mixed picture
* Coming Up: EIA stockpile report at 1430 GMT
(Updates prices, adds further quotes, changes dateline)
By Alejandro Barbajosa and Jo Winterbottom
LONDON, March 24 (Reuters) - Oil fell by more than $1 per
barrel to under $81 on Wednesday on concerns over a build-up in
U.S. crude stocks, the chance gasoline demand would not stretch
supplies and underlying lack of confidence in global recovery.
U.S. crude oil futures for May <CLc1> touched a low of
$80.35 a barrel and by 1011 GMT were trading down $1.42 at
$80.49. It has traded between $69 and $84 so far this year.
London ICE Brent <LCOc1> for May was down $1.37 at $79.33 after
earlier dipping to a low of $79.30.
U.S. crude stockpiles jumped 7.5 million barrels the week
ended March 19, five times as much as forecast in a Reuters poll
<API/S>, the American Petroleum Institute (API) said on Tuesday.
Supplies of distillates including heating oil and diesel
fell 2.5 million barrels while gasoline stocks were little
changed.
"If you just add up 7.5 minus 2.5 you have a net increase of
5 million, and that is pretty big," said Tony Nunan, a risk
manager with Tokyo-based Mitsubishi Corp.
"Refiners are trying to maintain their margins by cutting
crude runs to keep product inventories down," Nunan said, adding
that U.S. stockpiles are still "much higher" than their
five-year average.
The gasoline crack -- the theoretical premium refiners get
for making gasoline from crude -- touched a high for 2010 around
$14.60 earlier this week and is now just under $13. Demand often
rises going into the U.S. summer as drivers take off on holiday.
"With plenty of stocks and relative values that are
favouring (making gasoline), the U.S. consumer will have to
drive a long way before putting the supply capacity at risk,"
said Petromatrix in a report.
Oil inventories could have less influence on prices,
however, than equities, according to Breaking Views columnist
John Kemp. []
Data in the euro zone painted a mixed picture on the
economy, with manufacturing activity growing in March at its
highest level since the end of 2006 [] but
industrial orders in January falling, underscoring the fragility
of the economic recovery. []
DOLLAR GYRATIONS
Petromatrix added that "predicting the dollar gyration in
front of the European meeting on Greece is a difficult task"
this week, adding the gasoline crack would be their focus.
The dollar strengthened further against a basket of
currencies <.DXY> ahead of Thursday's meeting of European Union
leaders to discuss how to help Greece deal with its debt crisis
and prevent problems spreading to other economies.
"When people are concerned about Greece, they are also
concerned about the economic health of Europe and consequently
oil demand," Nunan said, adding he thought the inverse
relationship between the dollar and oil was starting to break.
Oil market investors and traders will be seeking
confirmation of the API figures from weekly U.S. government
statistics that will be published by the Energy Information
Administration (EIA) on Wednesday at 1430 GMT.
Crude prices have traded in a much narrower range this year
than the $50 or so in 2009 and continue to lack fundamental
momentum to break out either up or down.
Ministers of the Organization of the Petroleum Exporting
Countries (OPEC) said they expect oil prices to stay around
current levels for the rest of the year.
The group agreed to leave production targets unchanged last
week citing accelerating demand growth in the second half and
continued economic uncertainty.
"It's a push and pull between short-term oversupply versus
expectations of medium-term tightness," Nunan said.
(Additional reporting by Alejandro Barbajosa in Singapore;
editing by James Jukwey)
