NYMEX-Crude down over 1 pct as product stocks rise

* EIA: crude inventories down, product stocks up

* Equities up on natural resources boost, dollar down

NEW YORK, July 1 (Reuters) - U.S. crude oil futures were more than 1
percent lower Wednesday afternoon, pressured by government data showing
gasoline and distillate inventories rose more than expected last week,
sidelining a larger-than forecast drawdown in crude stocks.

"You see gasoline and distillate stocks up in the EIA data and you know
it's an old story: demand is down. That, in a nutshell, is what the latest
data show," said Tom Knight, trader at Truman Arnold in Texarkana, Texas.

On a weekly basis, both gasoline and distillate demand dropped.
Particularly disappointing for traders was the decline in gasoline demand
ahead of the July 4 Independence Day holiday, usually a time of heavy usage
of the motor fuel.

Gasoline and heating oil futures were stuck with losses of more than 1
percent after the latest inventory report.

The crude stock draw reported by the U.S. Energy Information
Administration was far less than what industry group American Petroleum
Institute reported late Tuesday, cooling down the market surge before the
government data were released at 10:30 a.m. EDT (1430 GMT).

PRICES

* On the New York Mercantile Exchange at 1:30 p.m. EDT (1730 GMT),
August crude CLQ9 was down $1.06, or 1.52 percent, at $68.83 a barrel,
trading from $68.66 to $71.85. Tuesday's $73.38 peak was the highest
intraday front-month price since Oct. 21 when crude hit $75.69.

* In London, August Brent crude LCOQ9 was down 89 cents, or 1.28
percent, at $68.41 a barrel, trading from $68.32 to $71.32.

* NYMEX August RBOB RBQ9, the new front-month, fell 5.34 cents, or
2.81 percent, to $1.8486 a gallon, trading from $1.8444 to $1.9506.

* NYMEX August heating oil HOQ9, also a new front-month, was down
3.69 cents, or 2.06 percent, at $1.7508 a gallon, trading from $1.7487 to
$1.8291.

* The August/August RBOB crack spread <0#RB-CL=R> was at $8.81, after
ending at $9.99 on Tuesday. The August/August heating oil crack spread
<0#CL-HO=R> was at $4.70, after ending at $5.19 on Tuesday.

* The spread between the current front month and the five-year forward
crude contract CLc61 was at $14.96, based on the August 2014 contract
Tuesday settlement at $83.79. The spread ended Tuesday at $13.90.

MARKET NEWS

* EIA said that for the week to June 26 domestic crude supplies fell
3.7 million barrels to 350.2 million barrels against the forecast for a 2
million barrel drawdown in a Reuters poll. [EIA/S]

* Stocks at the Cushing, Oklahoma delivery hub for NYMEX-traded oil
rose 400,000 barrels to 28.6 million barrels.

* Gasoline stocks rose 2.3 million barrels to 211.2 million barrels,
above the forecast for a 1.9 million barrel build.

* Distillate stocks jumped 2.9 million barrels to 155 million barrels,
far more than the forecast for a 1.5 million barrel increase.

* American Petroleum Institute said Tuesday that domestic crude stocks
fell 6.8 million barrels to 349.7 million barrels, gasoline stocks rose
209,000 barrels and distillate stocks gained 723,000 barrels. [API/S]

* U.S. stocks rose as improving prospects for manufacturing around the
world suggested the global economy was recovering. [.N]

* The dollar fell further against the euro after news that cited
sources as saying China has asked to debate proposals for a new global
reserve currency at next week's Group of Eight summit. [USD/]

* U.S. private employers cut 473,000 jobs in June, more than expected
but down from the 485,000 jobs lost in May, a report by ADP Employer
Services said. [ID:nN01376699]

* U.S. construction spending fell 0.9 percent in May to the lowest rate
in more than five years, with the economic stimulus plan passed in February
providing little relief in public
construction, according to Commerce Department data.

* Pending sales of previously owned U.S. homes rose in May, the fourth
straight monthly gain. [ID:nN01500737]

* OPEC oil supply rose in June as higher output from several members of
the group offset cutbacks in Nigeria caused by militant attacks, a Reuters
survey showed. [ID:nL1463359]
(Reporting by Gene Ramos and Robert Gibbons;
Editing by John Picinich)