Oil slid below $67 a barrel on Wednesday, extending losses from the more than $1 retreat the day before, on renewed concerns over the U.S. economy after a drop in consumer confidence and bearish API crude data.

The American Petroleum Institute (API) reported that U.S. crude oil stockpiles jumped 4.1 million barrels last week, countering analysts' expectations for a 1.3 million-barrel draw, as imports rose and refiners slowed their processing rates.

But traders are looking more toward data from the U.S. Energy Information Administration (EIA), due later at 10:30 a.m. EDT, in which a Reuters poll forecast a 1.3 million-barrel decline in crude inventories instead, as lower imports offset tepid refinery demand.

The survey also showed a 400,000-barrel rise in gasoline stocks and a 1.3 million-barrel increase in distillates.

The API data tends to be skewed, said Mark Pervan, head of Commodity Research at ANZ Bank.

The DOE is expecting a drop in crude supplies. But the API data is the latest indicator of weak demand. Overall, the crude stock level is too high for this time of year.

U.S. crude fell 44 cents to $66.79 a barrel by 10:52 p.m. EDT, after settling $1.15 lower on Tuesday, after the U.S. consumer confidence index dropped below analysts' expectations, recording its second-straight decline as sentiment remained dampened by a difficult job market.

London Brent shed 11 cents to $69.77 a barrel.

Equities markets in Asia, which had rallied for over a week, were mixed in early trade, with Hong Kong stocks falling but Japan's Nikkei average barely up, after disappointing corporate earnings results pushed down U.S. markets.

The oil market declined because of the equities market. But that's a fickle strategy to use, and the underlying demand-supply fundamentals are being pushed aside, said Pervan.

Hopes that a recovery in the global economy could lift slumping fuel demand has propped up crude prices this year, but analysts said the inconsistent show of U.S. economic data is a timely reminder that the world is barely emerging from recession.

Crude fell from records near $150 a barrel last July to below $33 in December, as the recession battered world consumption, before recovering to near $70 recently.

Stubbornly weak demand, especially for distillates, has hit profits for refiners in Asia and the West, forcing them to rein in output.

Leading U.S. refiner Valero Energy Corp would run its 16 plants at 78 percent of capacity in the third quarter. And Mexican oil producer Pemex said lower crude prices and export volumes battered its sales and squeezed profits.

(Editing by Ben Tan)

Japan