NEW YORK (Bloomberg) -- Crude oil fell after U.S. payrolls unexpectedly declined last month, spurring concern that the economy and fuel demand will be slow to recover.

Oil slipped as much as 1 percent after the Labor Department reported that the world’s biggest energy-consuming country lost 85,000 jobs in December. Futures climbed to a 14-month high this week as temperatures dropped in the Northern Hemisphere, U.S. crude-oil supplies rose and the dollar weakened, bolstering the appeal of commodities to investors.
“These numbers increase skepticism about the recovery,” said Michael Fitzpatrick, vice president of energy with MF Global in New York. “There’s no rational reason for prices to be at these levels. We’ll probably soon see a good-sized setback in prices.”
Crude oil for February delivery fell 50 cents, or 0.6 percent, to $82.16 a barrel at 9:44 a.m. on the New York Mercantile Exchange. Futures are up 3.5 percent this week after touching $83.52 on Jan. 6, the highest level since Oct. 14, 2008.
Payrolls were forecast to be unchanged, according to the median estimate of 76 economists surveyed by Bloomberg News.
“Today’s unemployment number underscores that any recovery in payrolls will be slow,” said Rick Mueller, director of oil markets at Energy Security Analysis Inc. in Wakefield, Massachusetts. “The recent rally was, in part, built on a much rosier outlook for the economy than these numbers paint. This will probably cool things off.”
U.S. inventories of crude oil rose 1.33 million barrels to 327.3 million last week and gasoline supplies increased by 3.74 million barrels to 219.7 million, the highest since the week ended Jan. 30, 2009, according to an Energy Department report on Jan. 6. Supplies of distillate fuel, a category that includes heating oil and diesel, declined by 233,000 barrels.
“The supply cushion of heating oil is quite high,” said Harry Tchilinguirian, head of commodity derivatives research at BNP Paribas SA in London. “And with refinery utilization rates quite low, there’s ample room to expand runs for meeting incremental demand.”
Refineries operated at 79.9 percent of capacity last week, down 0.4 percentage point from the prior week and the lowest level since November. Refiners have operated at 87.4 percent of capacity during the first week of January over the past five years.
Crude oil may fall next week on speculation that U.S. inventories will climb for a second week and as fuel demand declines, a Bloomberg News survey showed. Nineteen of 43 analysts, or 44 percent, said oil will drop through Jan. 15. Fifteen respondents, or 35 percent, forecast that the market will climb and nine said prices will be little changed
Brent crude oil for February settlement dropped 49 cents, or 0.6 percent, to $81.02 a barrel on the London-based ICE Futures Europe exchange.