(Reuters) - Oil prices fell below $72 a barrel on Tuesday, down for a fifth day after weak U.S. economic data spread gloom about the ability of top consumer the United States to work through record stocks.
U.S. crude prices fell $1.28 to $71.82 a barrel by 1411 GMT, after earlier sliding to $71.45, leaving prices at the lowest level since early July.
Prices extended losses intraday after sales of previously owned U.S. homes dropped more steeply than expected in July to their lowest pace in 15 years, an industry group said.
ICE Brent crude futures shed $1.10 by the same time to $72.52 a barrel, maintaining its premium to the rival benchmark established last week.
Existing home data was worse than expected and is putting pressure on everything, said Tom Bentz, broker at BNP Paribas Commodity Futures Inc in New York.
U.S. equities slid more than 1 percent at the open on Tuesday after the poor data, reinforcing the strong correlation between the two asset classes. .N
On the supply side, U.S. crude oil inventories are forecast to have risen by 800,000 barrels last week, according to a preliminary Reuters poll of eight analysts ahead of American Petroleum Institute data at 2030 GMT and U.S. government data on Wednesday.
Typically stocks fall through the summer driving season, but they instead rose to a record high in the United States in the week to August 13.
The bearish trend since August 17 is intact. Economic momentum is slowing, and everyone is worried about it. Both supply and demand fundamentals are weak, said VTB Capital analyst Andrey Kryuchenkov.
Hurricane Danielle strengthened over the Atlantic Ocean to a category two storm on Tuesday but posed no threat to land or energy interests, the U.S. National Hurricane Center said.
This Atlantic hurricane season was forecast to be the most active in five years, inflating oil prices with a storm-related premium, but few have emerged.
For now, analysts said that the potential for future storms was likely to support oil at around $70 a barrel.
The fact that we have yet to enter the most critical part of the hurricane season (September) should prevent complacency and likely force the market to hold $70 support, said Edward Meir, senior commodity analyst at MF Global.
Oil prices have fallen by around 13 percent since hitting a three-month high of $82.97 a barrel in early August as evidence has mounted that the fuel demand recovery is likely to be protracted while stocks have swelled.
(Additional reporting by Robert Gibbons in New York and Alejandro Barbajosa in Singapore, editing by William Hardy)