* U.S. crude stocks rose 822,000 bbls last week -API
* Diesel rebounds on near-term cold -analysts
* Coming up: EIA data Wednesday 10:30 a.m. EST (1530 GMT)
(New throughout, updates prices and market activity, adds API
By Elizabeth Dilts
NEW YORK, Feb 25 Oil fell on Tuesday, pressured
by further signs of a Chinese economic slowdown and data that
showed a build in U.S. crude stockpiles for the second straight
Persistent production outages in Libya and South Sudan
capped losses in Brent while U.S. oil was pressured by sinking
gasoline futures prices in the face of lessening demand for the
U.S. weekly crude stocks rose by a less-than-expected
822,000 barrels in the week to Feb. 21, according to data from
the American Petroleum Institute released Tuesday. A preliminary
Reuters poll forecast an increase of 1.2 million barrels.
Oil stocks at Cushing, Oklahoma, the benchmark delivery
point for the U.S. oil futures contract, fell by 1.1 million
barrels, API data showed. Still, traders said that oil simply
moved from one location to another along the Gulf Coast as
refiners enter maintenance season and demand for crude oil
"They're just moving those barrels south and that's putting
pressure on the market," said Bob Yawger, director of
commodities futures at Mizuho Securities in New York.
The U.S. Energy Information Agency will release its
inventory report Wednesday at 10:30 a.m. EST (1530 GMT).
Worries of slower growth in China worsened as the yuan fell
more than 1 percent against the U.S. dollar.
Brent crude fell $1.13 to settle at $109.51 a
barrel, after settling at its highest level this year in the
previous session. U.S. oil fell 99 cents to settle at
$101.83 per barrel, after falling nearly $2 earlier in the
Brent's premium to U.S. crude CL-LCO1=R widened to $8.85
on Tuesday, before tightening to settle just 14 cents wider at
$7.68. On Monday, the spread narrowed to a nearly five-month low
of $7.04, but failed to pass several key resistance levels
around $7, analysts said.
A stronger U.S. dollar bolstered by comments from a top
Federal Reserve regulator that the central bank will continue
monetary tightening in the future also weighed on U.S. crude and
commodities priced in the dollar.
U.S. heating oil erased earlier losses and rose on forecasts
for more extreme cold in the near-term, analysts said. New York
ultra-low sulfur diesel futures (ULSD), commonly known as
heating oil, rose 1.71 cents to settle at $3.1043 per gallon.
RBOB gasoline prices for March, which expire on
Friday, fell 3-1/2 cents to settle at $2.7981 per gallon.
"The next two weeks shows freezing weather and the
distillate market is tight enough that the rally should
continue," said Rich Hastings, macro strategist with Global
Gasoline futures are "looking for a bit firmer signals," he
Gasoline stocks fell by 314,000 barrels, while distillate
stockpiles fell by 693,000 barrels, API data showed.
Brent oil drew support from supply outages in Africa. Libya
has put some government departments under special spending rules
as a slump in oil revenue has hampered the drafting of a budget
for this year. Protests at oilfields and ports have knocked oil
production down to 230,000 barrels per day (bpd) from 1.4
million bpd in summer.
Fighting in South Sudan has seen oil output fall by a third
since December to about 170,000 bpd last week.
(Additional reporting by Lin Noueihed and Shadi Bushra in
London and Manash Goswami in Singapore; editing by Mark
Heinrich, Marguerita Choy and Matthew Lewis)