By Grant Smith Nov. 24 (Bloomberg) -- Crude oil traded little changed around $77 a barrel before a report forecast to show that higher-than-normal crude inventories grew last week in the U.S. The U.S. Energy Department will probably report tomorrow that stockpiles grew by 1.5 million barrels in the week ended Nov. 20, according to a Bloomberg survey. Analysts were split over the change in supplies of distillate fuels such as heating oil and diesel, which are 28 percent above the seasonal average. “At least until the end of the year we see $80 as the top of the range,” said Tobias Merath, a commodity analyst at Credit Suisse Group in Zurich. “What’s limiting the potential in the short term is the supply glut in the distillate market.” Crude oil for January delivery traded for $77.43 a barrel on the New York Mercantile Exchange, 13 cents lower, as of 1:08 p.m. London time. Oil, which rose as high as $79.92 yesterday, has failed to close above $80 since Nov. 4. Futures have gained 73 percent this year. Oil was capped by strengthening in the U.S. dollar, which often limits the appeal of commodities for hedging inflation. The dollar traded at $1.4978 per euro at 1:07 p.m. in London, compared with $1.4961 yesterday in New York. “The floor has been set by the weaker dollar, higher inflation theme, while the ceiling has been set by weak refining margins, and a global recovery that is expected to be sluggish,” said Mike Wittner, head of oil market research at Societe Generale SA in London. Distillate Supplies Commercially held crude stockpiles in the U.S. climbed 1.5 million barrels in the week ended Nov. 20 from 336.8 million in the prior week, according to the median of 13 estimates from analysts polled. Eleven respondents forecast a gain and two said there would be a decline. Analysts were split over whether U.S. distillate supplies, a category that includes heating oil and diesel, rose or fell last week. Stockpiles probably dropped 100,000 barrels from 167.4 million the prior week, according to the survey. Seven respondents forecast a decline and six said supplies increased. Gasoline inventories probably climbed 300,000 barrels from 209.1 million the week before, the survey showed. Refineries operated at 79.7 percent of capacity, up 0.3 percentage point from the previous week, according to the median of responses. Oil declined for the third time in four days as the dollar strengthened against the euro, prompting traders to close trading positions before the long U.S. holiday weekend. The Energy Department report tomorrow may show the country’s crude oil stockpiles had risen, possibly reaching a four-week high, bolstering concern fuel demand may have yet to recover. “In coming months, oil products are expected to be drawn down as the U.S. winter starts up,” said Ben Westmore, an energy and minerals economist at National Australia Bank Ltd. in Melbourne. “The market’s already factored in a drawdown in prices, and now we’re waiting to see if it happens.” Brent crude oil for January delivery on London’s ICE Futures Europe exchange advanced as much as 38 cents, or 0.5 percent, to $77.87 a barrel. The contract was at $77.67 a barrel at 1:06 p.m. London time. To contact the reporters on this story: Grant Smith in London at gsmith52@bloomberg.net

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