* U.S. fuel stocks rise, weighing on futures
* Oil down 11 pct in Q2, first quarterly loss since 2008
* Weak U.S. employment figures weighed on oil
(Recasts, updates prices, market activity; new byline moves
dateline from previous LONDON)
By Robert Gibbons
NEW YORK, June 30 (Reuters) - Oil fell in choppy trading on
Wednesday after U.S. fuel stocks unexpectedly rose, adding to
anxiety over the strength of oil demand as the market headed
for its first quarterly loss since late 2008.
U.S. crude for August <CLc1> fell 50 cents, or 0.66
percent, to $75.44 a barrel by 1:36 p.m. EDT (1736 GMT),
falling into negative territory after the inventory report. ICE
Brent crude <LCOc1> fell 41 cents to $75.03.
U.S. oil product contracts led the decline, with the
expiring July gasoline <RBN0> futures falling 2.60 cents, or
1.25 percent, to $2.0460 a gallon and July heating oil <HON0>
slipping 3.82 cents, or 1.89 percent, to $1.9831 a gallon.
Gasoline stocks unexpectedly rose 537,000 barrels and
distillates inventories gained a much larger than forecast 2.46
million barrels in the week to June 25, the U.S. Energy
Information Administration reported on Wednesday. []
Crude oil stocks, however, fell by 2.01 million barrels,
more than double expectations.
"Even though there is a larger-than-expected draw in crude
stocks, we have a build in gasoline, which went against
forecasts for a draw, and a very big increase in distillates,"
said Mark Waggoner, president, Excel Futures in Bend, Oregon.
The EIA report followed Tuesday's American Petroleum
Institute report, which said crude stocks fell 3.4 million
barrels, less than the EIA though both reports showed larger
draw downs than the forecast 900,000-barrel. []
Crude stocks at the key Cushing, Oklahoma, delivery point
for benchmark U.S. crude fell for a second week running,
dropping by 795,000 barrels, according to the EIA.
The recent slip from record high storage at the Cushing hub
has helped narrow the price spread between the front-month and
near month U.S. crude contracts. The spread narrowed to about
50 cents <CL-1=R> on Wednesday from $1.21 on Tuesday.
ALEX TO HIT MEXICO
Wednesday's price fall was limited by Hurricane Alex, which
has forced oil companies to shut in nearly 400,000 barrels per
day of Gulf of Mexico oil production despite the fact that it
remained on track to make landfall on the Mexican coast, well
to the southwest of the main platforms. []
Down more than 10 percent since the end of March, U.S.
crude is on course for its first quarterly price decline since
2008 as stresses in financial markets and weak employment
numbers limited the pace of recovery.
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For a graphic on performance across commodity markets in
the last quarter, please click:
http://link.reuters.com/hun72k
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U.S. crude prices hit a 19-month high at $87.15 on May 3,
but reverberations from Europe's debt crisis and the tepid pace
of growth in top consumers China and the United States pulled
oil prices back.
Adding to the economic concerns, data from ADP Employer
Services on Wednesday showed private employers in the United
States added less than a third of the jobs expected in June.
[]
Oil prices received some support on Wednesday from the
euro's strength.
The euro strengthened after European banks borrowed less
than expected from a three-month tender by the European Central
Bank, reducing fears they have become too reliant on emergency
funding ahead of the repayment of 442 billion euros ($541
billion) in one year loans.
(Additional reporting by Gene Ramos in New York, David
Sheppard and Alex Lawler in London and Alejandro Barbajosa in
Singapore; Editing by David Gregorio)
