Member access

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesHot NewsMost Read NewsRecomm.Business LeadersVideosCalendar 

OIL FUTURES : Nymex Crude Drops Below $98/Bbl After Jobs Data

05/04/2012 | 12:18pm US/Eastern

--Crude oil plummets below $98/bbl for first time since February

--Weak US jobs data tip market lower, though bearish signs have been building

--Futures down 10% from recent highs

 
   By Dan Strumpf and Ben Lefebvre 
   Of  
 

U.S. crude-oil futures plunged below $98 a barrel for the first time since February, giving up more than $4 after a weaker-than-expected U.S. jobs report.

Light, sweet crude oil for June delivery recently traded $4.36, or 4.2%, lower at $98.18 a barrel on the New York Mercantile Exchange. Brent crude oil on ICE Futures Europe fell $3.88, or 3.3%, to $112.22 a barrel.

The benchmark U.S. contract tipped below $100 a barrel in the aftermath of the jobs report, then continued its slide through the morning.

The Labor Department said U.S. nonfarm payrolls rose by 115,000 in April, less than the gain of 168,000 expected by economists surveyed by Dow Jones Newswires. The unemployment rate fell a tenth of percentage point to 8.1%.

Employment data in the U.S., the world's biggest oil consumer, is a closely watched indicator of fuel and oil demand. Weak employment data usually correlate with lackluster demand as fewer motorists travel to work or take vacations.

The jobs report, though disappointing, "wasn't catastrophic," said Andy Lebow, senior vice president of energy futures at Jefferies Bache. But it came on the heels of downbeat economic data from both the U.S. and Europe and further erodes confidence in the broader economy.

"The global economy has given indication for weeks that it's slowing down," he said.

Earlier this week, Spain disclosed that it is officially in a recession, while a survey of economic activity in the euro zone in April found a faster contraction than previously thought.

Meanwhile, Saudi Arabia, the world's largest oil exporter, has increased production to 10 million barrels a day in recent months. And oil inventories in the U.S. continue to swell, rising 10% over the last 10 weeks amid weak demand for crude oil.

Nymex crude-oil futures have fallen more than 10% since hitting a recent settlement high of $109.77 a barrel in late February. Brent crude oil, the European benchmark, has seen an even steeper fall, dropping more than 11% from its recent high earlier this year.

The U.S. jobs data also follow two months of weaker-than-expected employment growth. Traders who thought that the earlier figures were an exception are now worrying that they may be the rule, said Jason Schenker, energy analyst at Prestige Economics.

"If anyone had an inkling of bearish sentiment, today's the day to pull out fast," he said.

Front-month June reformulated gasoline blendstock, or RBOB, recently fell 9.11 cents, or 3%, to $2.9589 a gallon. June heating oil fell 9.89 cents, or 3.2%, to $2.9880 a gallon.

-By Dan Strumpf, Dow Jones Newswires; 212-416-2818; dan.strumpf@dowjones.com.

React to this article
Latest news
Date Title
7m ago MOODY : says that large share of forex loans affects Romania's banking system
7m ago SAUDI KAYAN PETROCHEMICAL : announces meeting financial conditions successfully
7m agoDJDeutsche Bank to Review Strategy Next Year
11m ago SHOKO : Tax:) (CORRECTION )
19m ago SAUDI OIL MIN : 'Let the most efficient producers produce'
24m ago UK inflation plunge does not pose deflation risk - BoE's Miles
27m ago TOWER : is Trade Me's new insurance partner
30m ago MOODY : New indirect taxes 'last resort' for GCC
37m ago BASF SE : Asset swap between BASF and Gazprom will not be completed
38m ago Saudi's Naimi says prices will stimulate demand, confident market will recover
Latest news
Advertisement
Hot News 
DENDREON : Entry into a Material Definitive Agreement, Change in Directors or Principal Officers, Other Events, Financial Statements and Exhibits (form 8-K)
DIXONS CARPHONE : *exane bnp raises dixons carphone price target to 510 (450) pence - 'outperform'
BERKELEY MINERAL RESOURCES : Obsidian IR
NATURE : Warns 2014 Results To Be "Materially" Below Market View
FINISH LINE : Reports Third Quarter Fiscal Year 2015 Results
Most Read News
1d ago COMCAST : DISH, Comcast SportsNet reach deal in regional dispute
1d ago APPLE : Innovation – The Apple way
1d ago MACY : When Apple Pay Requires a Signature and When it Doesn't
1d ago INDUSTRY ANALYST JEFF KAGAN : Will AT&T GigaPower Beat Google Fiber
1d ago FRANCESCA : announces new CEO amid faltering sales
Most recommended articles
7m agoDJDeutsche Bank to Review Strategy Next Year
19m ago SAUDI OIL MIN : 'Let the most efficient producers produce'
24m ago UK inflation plunge does not pose deflation risk - BoE's Miles
37m ago Saudi's Naimi says prices will stimulate demand, confident market will recover
50m ago British upstart banks get IT boost to take on big rivals
Dynamic quotes  
ON
| OFF