* Eyes on crude stock figures from EIA due at 1430 GMT
* Rise in China's implied oil demand for third month
(Updates detail, prices)
By Christopher Johnson
LONDON, July 22 (Reuters) - Oil fell 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 awaited U.S. Energy Information Administration
(EIA) data due at 1430 GMT to see if they would confirm
Tuesday's American Petroleum Institute (API) figures.
U.S. crude oil for September delivery was down 84 cents at
$64.77 a barrel by 1055 GMT, having fallen to a low of $64.42.
London Brent crude for September lost 50 cents to $66.37.
"The market has exhausted itself and needs to pause," VTB
Capital analyst Andrey Kryuchenkov said in a research note.
"Today, all attention will be on the weekly U.S. fuel
inventories."
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. []
HISTORICALLY HIGH STOCKS
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," broker MF Global said in its
daily note to clients. "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. []
Equities markets also supported sentiment.
World stocks clung close to nine-month highs with some
profit taking in Europe keeping a lid on further gains.
MSCI's all-country world stock index <.MIWD00000PUS> was
down 0.2 percent, just off a 2009 high reached on Tuesday that
took the index to levels last seen in October 2008.
Asian shares hit a 10-month peak. []
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
Keiron Henderson)
