Oil falls to $87 on large U.S. fuel stocks build

By Randy Fabi

U.S. light crude for March delivery fell $1.31 to $87.10 a barrel by 1548 GMT, adding to losses of nearly 2 percent the previous session.

U.S. crude stocks rose 7 million barrels last week, the Energy Information Administration said, surpassing analysts' expectations for a 2.6 million barrel build.

"These numbers are all bearish," said Tim Evans, analyst at Citigroup Futures Research. "Inventories were up across the board, implied demand looked terrible."

"The U.S. economy just attracts more bad news and demonstrates its fragility," said Robert Laughlin of MF Global. "For oil, demand will slip and prices should come under renewed pressure in the short-term."

The Organization of the Petroleum Exporting Countries (OPEC) could keep output at current levels when its ministers meet next month if there is no change in the market, Secretary-General Abdullah al-Badri said on Tuesday.

(Additional reporting by Fayen Wong in Sydney; Editing by Anthony Barker)

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