By Mark Shenk Sept. 24 (Bloomberg) -- Crude oil fell to a one-month low in New York as sales of existing homes unexpectedly slumped, bolstering skepticism about the speed of the economy’s recovery from the recession. Oil declined as much as 4.6 percent as the National Association of Realtors said that purchases dropped 2.7 percent to a 5.1 million annual rate. An Energy Department report yesterday showed a larger-than-forecast gain in U.S. fuel supplies, bolstering speculation that a glut in supply is forming in the world’s biggest energy-consuming country. “There comes a point when you have to pay attention to the fundamentals,” said Rick Mueller, a director of oil markets at Energy Security Analysis Inc. in Wakefield, Massachusetts. “There has been a lot of talk about green shoots, but we are still shedding jobs and oil demand is still going to drop by 2 million barrels this year.” Crude oil for November delivery fell $2.66, or 3.9 percent, to $66.31 a barrel at 11:10 a.m. on the New York Mercantile Exchange. Futures touched $65.79, the lowest level since Aug. 17. Prices have ranged between $65 and $75 since July 31. The drop in oil prices accelerated after the dollar climbed against the euro. A rising U.S. currency dims investor demand for commodities as a hedge against inflation. Concern that the U.S. housing market may be slow to recover also sent equities lower. The Standard & Poor’s 500 Index lost 0.7 percent to 1,053.46 and the Dow Jones Industrial Average slipped 0.3 percent to 9,719.38. ‘Bearish Picture’ “Today we are looking at a much more convincingly bearish picture,” said Tim Evans, an energy analyst with Citi Futures Perspective in New York. “We are not only looking at high inventory levels. The dollar is showing some strength and the S&P 500 is convincingly down.” Global oil consumption will drop 1.9 million barrels a day to 84.4 million this year, according to an International Energy Agency report released on Sept. 10. U.S. gasoline stockpiles surged 5.41 million barrels last week, more than 10 times what was forecast by analysts in a Bloomberg News survey, according to yesterday’s Energy Department report. Inventories of distillate fuel, a category that includes heating oil and diesel, rose 2.96 million barrels, almost double what was estimated. “We had three major stock builds and increases in the year-on-year surplus,” said Peter Beutel, president of trading adviser Cameron Hanover Inc. in New Canaan, Connecticut. “We are testing support and will have to see if we can break out of the recent range.” Supplies of crude oil rose 2.86 million barrels, to 335.6 million barrels, the biggest increase since the week ended July 24. Analysts had expected a 1.4 million-barrel decrease. The gain left stockpiles 9.1 percent above the five-year average. Technical Support “There’s no question that yesterday’s report was extremely bearish,” Mueller said. “It fell enough to break through some support lines, which got the attention of the technical guy.” The November contract broke below the 100-day moving average of $69.53 yesterday, a signal to so-called technical traders that prices will move lower. Futures have gained 49 percent this year on speculation global fuel consumption may recover as economies emerge from the recession and as a weakening dollar encourages investors to purchase commodities as an inflation hedge. Brent crude for November settlement dropped $2.71, or 4 percent, to $65.28 a barrel on the London-based ICE Futures Europe exchange. The contract touched $64.97, the lowest since July 17.

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