Oil fell for a second day on Thursday, approaching $82, as dollar strength kept a lid on prices, neutralizing the effect of upbeat U.S. employment data and a drop in the nation's crude inventories last week.

At the same time, U.S. stockpiles of gasoline and distillate fuels, including diesel, extended a string of gains, contributing to a mixed perception about the outlook for oil demand from the world's top consuming nation for the rest of the year.

U.S. crude for September fell 29 cents to $82.18 a barrel by 2:49 a.m. ET, having touched a three-month intraday high of $82.97 on Wednesday. ICE Brent shed 27 cents to $81.93.

U.S. private employers added more jobs than expected in July after an upwardly revised gain in June, payrolls processor ADP Employer Services said on Wednesday, ahead of reports for weekly jobless claims on Thursday and July non-farm payrolls on Friday.

Investors are more concerned over the rise in gasoline inventories versus the drawdown in crude, said Serene Lim, a Singapore-based oil analyst at ANZ.

That outweighed the better-than-expected U.S. economic data. Also, the dollar has an inverse relation with oil prices.

Oil reacted to the stronger U.S. currency, shrugging off the effect of rising equities in Asia. The greenback rose 0.25 percent against a basket of currencies on Thursday, extending the gains of the previous day. .DXY

A stronger dollar renders oil imports more expensive for Asian consumers including Asia-Pacific's top five -- Indonesia, South Korea, India, Japan and China -- which combined use about the same amount of oil as the United States.

For a graphic of oil's returning currency correlation, click: here

PAST THE $80 HURDLE

Oil surpassed $80 a barrel for the first time since early May this week after being stuck in the mid $70s for almost two months.

The oil market may not yet have fully shrugged off the intense degree of macroeconomic pessimism that kept prices below $80 for most of second quarter, but it is perhaps now starting to put that pessimism into more of a context and make it less of a dominating shadow in terms of price formation, Barclays Capital analysts said in a weekly report dated August 4

The vast service sectors in the U.S. and euro zone both grew last month, reports showed on Wednesday, easing some worries about a severe slowdown in the global economic recovery.

But the positive economic data has yet to be reflected in U.S. fuel inventories, which have been rising for most of the northern hemisphere summer, when gasoline demand peaks and inventories of the fuel usually fall.

The Energy Information Administration on Wednesday said the country's gasoline stocks rose for an unexpected sixth consecutive week, by 729,000 barrels, and supplies of distillate fuel including diesel climbed for a tenth, by 2.8 million.

The government statistics also showed U.S. crude stockpiles slumped 2.8 million barrels last week after Tropical Storm Bonnie caused delays to oil shipments and production.

Asian stocks edged higher on Thursday after solid corporate earnings, including from Toyota Motor and chipmaker UMC, and the strong U.S. economic data that lifted the beaten-down dollar.

Saudi Arabia cut the official selling prices (OSPs) of benchmark Arab Light crude oil and most other grades to Asia, the United States and Europe in September, state-run oil company Saudi Aramco said on Wednesday.

BP Plc (BP.L)(BP.N) said on Wednesday it was close to subduing its ruptured Gulf of Mexico oil well, and the White House hailed the beginning of the end of efforts to contain the worst spill in U.S. history.

(Editing by Ed Lane)

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