* Eyes on crude stock figures from EIA due at 1430 GMT
* Rise in China's implied oil demand for third month
(Updates throughout, previous SINGAPORE)
By Christopher Johnson
LONDON, July 22 (Reuters) - Oil slipped below $65 a barrel
on Wednesday after data showing an unexpected rise in U.S. crude
stocks suggested demand in the world's top energy consumer was
still weak.
The market is awaiting U.S. Energy Information
Administration (EIA) data later on Wednesday to see if they will
confirm the American Petroleum Institute's (API) figures.
"The API numbers will likely exert pressure on the crude
complex over the course of the Wednesday session, as they imply
that the EIA numbers will likely follow suit," said MF Global in
its daily note to clients.
U.S. crude oil for September delivery was down 83 cents at
$64.78 a barrel by 0750 GMT, off a low of $64.75. London Brent
crude for September fell 44 cents to $66.43.
U.S. crude oil stockpiles rose unexpectedly last week as
domestic refining activity slumped, the API said on Tuesday.
Commercial oil inventories jumped 3.1 million barrels to
349.883 million barrels, reversing a stretch of weekly declines
triggered by thin import levels and defying analyst expectations
for a 2.1 million barrel drop. []
A Reuters survey of 15 analysts forecast the EIA would
report a drop in crude oil inventories as slow imports countered
a decline in refining activity. []
INVENTORIES
But refined products supplies were expected to have risen,
despite the lower domestic refinery capacity use.
Global oil inventories are at historically high levels,
equivalent to around 62 days of forward demand by the
industrialised countries of the Organisation for Economic
Cooperation and Development (OECD).
"Energy demand remains weak," MF Global said. "We would also
conclude that the recent price rises we are seeing in energy are
more attributable to exogenous variables as opposed to any
noticeable improvement in the complex's basic fundamentals."
Data showing apparent oil demand in the world's
second-largest energy user rose for the third month in a row
could help limit oil's losses.
China's implied oil demand in June rose 1.8 percent over a
year ago, Reuters calculations from official data showed on
Wednesday. []
Asian equities markets also supported sentiment.
Asian shares climbed to a 10-month peak on Wednesday, but
gains were limited as investors locked in profits in the belief
that the run-up had become overstretched. []
On the supply front, Royal Dutch Shell <RDSa.L> said on
Tuesday it had resumed oil output at its EA oilfield in Nigeria,
a rare bright spot for an industry reeling from a string of
militant attacks in the last two months. []
Militants have devastated the OPEC member's oil output and
kept Nigeria from pumping above two-thirds of its installed
capacity, costing it billions of dollars in lost revenue.
(Additional reporting by Jennifer Tan in Singapore; editing by
James Jukwey)
