Oil prices fell a second straight day on Wednesday after economic and industry data fueled concerns about the pace of economic recovery and energy demand growth and also rising oil inventories.
Wednesday's U.S. Energy Information Administration inventory report showed crude oil stocks rose 7.31 million barrels last week as imports jumped. A Reuters analyst survey had forecast crude oil stocks would be down 1.6 million barrels.
Gasoline and distillate stocks also rose, though not as much as had been projected, the EIA said.
U.S. crude for September delivery fell 47 cents to $77.03 a barrel at 1:12 p.m. EDT, having recovered from a drop of $1.60 to a low of $75.90.
In London, ICE Brent edged down 20 cents to $75.93 a barrel, having traded as low as $74.80.
The crude oil inventory growth was the biggest jump since the week to October 3, 2008, when stocks rose 8.123 million barrels, according to EIA data.
Crude oil imports surged by 1.18 million barrels per day to 11.12 million bpd, the highest level for imports since the week of August 25, 2006.
Inventories at the key Cushing, Oklahoma, hub rose 66,000 barrels to 37.17 million barrels. Cushing is the delivery point for the New York Mercantile Exchange's benchmark West Texas Intermediate crude.
Obviously, the surprise (crude) build came because imports were a lot higher. People may have missed that because likely what we're seeing is not so much the impact of Tropical Storm Bonnie, but the aftermath of Hurricane Alex, said Phil Flynn, an analyst at PFGBest Research in Chicago.
I think there were some imports that were delayed that got in before the storm.
Bonnie dissipated last weekend, having done little damage to Gulf of Mexico energy infrastructure, although some production was interrupted. Hurricane Alex hit Mexico near the Texas border in early July.
The EIA report followed reports of cooling second-quarter economic growth that had already pressured oil.
New orders for U.S. manufactured durable goods fell unexpectedly for a second straight month in June, posting their largest decline since August.
That followed Tuesday's report that showed U.S. consumers in July were the least confident about the economy since February because of worries about employment.
Ahead of the consumer confidence report, crude oil prices reached $79.69 per barrel on Tuesday, their highest in almost 12 weeks.
CHOPPY NEAR 200-DAY MOVING AVG
Tuesday's U.S. crude price slump to a $77.50 settlement left prices below the front-month contract's 200-day moving average. The S&P 500 Index <.SPX> also closed below its 200-day simple moving average.
WTI moved back below the 200-day moving average and both WTI and the S&P still need to prove that they can sustain that line as a support rather than a resistance, Olivier Jakob, consultant at Petromatrix, said.
(Additional reporting by Eileen Moustakis and Rebekah Kebede in New York and Christopher Johnson in London; Editing by Walter Bagley)