Oil traded near the lowest price in almost two months in New York after an industry report showed crude stockpiles rose for a third week in the U.S., the world’s biggest consumer of the commodity.

Futures were little changed after dropping for a second day yesterday. U.S. inventories increased 6.6 million barrels last week, according to figures from the American Petroleum Institute. An Energy Department report today is forecast to show they rose 2 million to the highest level for this time of year since 1990, according to a Bloomberg survey. Prices have also fallen this week before international talks with Iran resume over its nuclear program.

“People are starting to question the global recovery,” said Jonathan Barratt, chief executive of Barratt’s Bulletin, a commodity markets newsletter in Sydney. “The erosion of the Middle Eastern premium is helping prices lower along with weak economic sentiment and that should see $100 a barrel tested.”

Oil for May delivery was at $100.93 a barrel, down 9 cents, in electronic trading on the New YorkMercantile Exchange at 11:29 a.m. Sydney time. The contract yesterday declined $1.44, or 1.4 percent, to $101.02, the lowest close since Feb. 14. Prices are up 2.1 percent this year.

Brent oil for May settlement fell 4 cents to $119.84 a barrel on the London-based ICE Futures Europe exchange. The European benchmark contract’s premium to New York-traded West Texas Intermediate was at $18.91, compared with $18.86 yesterday.

Fuel Supplies

U.S. crude stockpiles are forecast to climb to 364.4 million barrels in the seven days ended April 6, according to the median estimate of 10 analysts surveyed by Bloomberg News before today’s Energy Department report. Gasoline supplies are forecast to decline 1.38 million barrels, while the API data showed a gain of 1.18 million barrels. Inventories of distillates, a category that includes diesel and heating oil, may drop 250,000 barrels, compared with a decline of 476,000 barrels in the API report.

The API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey.

U.S. gasoline demand declined 0.8 percent last week from the prior seven days and consumption slipped below year-earlier levels for the 32nd consecutive week, MasterCard Inc. (MA) said in its SpendingPulse report yesterday. Drivers bought 8.8 million barrels a day of the fuel in the seven days ended April 6, down from 8.87 million the prior week, the report showed.

Iran Talks

The U.S. and its European allies will press Iran for action to curb its nuclear program when talks resume this week after a 15-month hiatus. Nuclear negotiations between Iran and the five permanent United Nations Security Council members plus Germany will start April 14 in Istanbul. The Islamic republic has threatened to close the Strait of Hormuz, a transit route for a fifth of the world’s crude, in response to a U.S. and European embargo.

Prices also slipped yesterday amid concern that the euro- region debt crisis will spread, curbing economic growth.

Spanish bonds tumbled and the yield on 10-year government debt climbed to the highest since Dec. 12. Economy Minister Luis de Guindos declined to rule out a rescue for the country and Bank of Spain Governor Miguel Angel Fernandez Ordonez said the nation’s lenders may need more capital if the economy weakens more than expected. Italian bonds also fell.

To contact the reporter on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net

To contact the editor responsible for this story: Alexander Kwiatkowski at

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