By Rachel Graham Nov. 13 (Bloomberg) -- Crude oil advanced as the dollar dropped, buoying demand for commodities as an alternative investment to the U.S. currency. Oil recovered after falling to its lowest in almost a month yesterday as a U.S. government report showed rising stockpiles of crude and oil products. The dollar weakened today to $1.4902 against the euro from yesterday’s close of $1.4850. “We are seeing a bit of a rebound after weak data yesterday,” Hannes Loacker, an analyst at Raiffeisen Zentralbank Oesterreich, said by phone from Vienna. “The dollar is a bit weaker today.” Oil for December delivery rose as much as 73 cents, or 1 percent, to $77.67 a barrel on the New York Mercantile Exchange and was at $77.30 a barrel as of 11:50 a.m. London time. Futures fell as much as 3 percent yesterday and touched as low as $76 earlier today, their lowest price since Oct. 15. The Energy Department report showed crude stockpiles rose a more-than-estimated 1.76 million barrels last week to 337.7 million barrels last week. Oil inventories are currently about 8 percent above last year’s levels. Demand for distillates, a category that includes heating oil and jet fuel, fell for a second week to 3.54 million barrels a day, according to yesterday’s Energy Department report. That is about 10 percent less than a year ago. “Distillate demand continues to belie the consensual predictions of a rapid rise in diesel use as the U.S. economy recovers,” Harry Tchilinguirian, a senior oil analyst at BNP Paribas SA in London, wrote in a report yesterday. U.S. Indicators The market is now awaiting U.S. economic data including trade figures and a report on U.S. consumer confidence, said Paul Harris, head of natural resources risk management at the Bank of Ireland in Dublin. “We are looking for any evidence of any return to growth in the U.S.,” Harris said. “That will drive the dollar and the dollar is one of the key drivers for oil.” The Reuters/University of Michigan preliminary index of U.S. consumer sentiment for this month may rise to 71 from 70.6 in October, according to the median estimate of economists surveyed by Bloomberg. Brent crude for December settlement added as much as 90 cents, or 1.2 percent, to $76.92 a barrel on the London-based ICE Futures Europe exchange and traded at $76.58 a barrel at 11:55 a.m. local time. To contact the reporters on this story: Rachel Graham in London rgraham13@bloomberg.net

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