×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

Oil extends losses towards $82, eyes US jobs data

Oil extends losses towards $82, eyes US jobs data
Comment E-mail Print Share
First Published: Fri, Jan 08 2010. 09 48 AM IST
Updated: Fri, Jan 08 2010. 09 48 AM IST
Singapore: Oil edged lower on Friday, extending losses made the previous day on worries about tighter Chinese monetary policy, with traders eyeing US jobs data due later for the next clue on economic growth and potential oil demand.
The US non-farm payrolls report could show the end of two years of uninterrupted job cuts in the world’s largest economy, signalling a gradual recovery in oil demand from the world’s largest energy consumer is on the cards.
“Everyone is a little bit nervous about the US jobs data tonight. It is a major factor in the outlook for the U.S. economy and the global recovery,” said Peter McGuire, Managing Director of Commodity Warrants Australia in Sydney.
US crude for February delivery was down 32 cents at $82.34 a barrel by 8:15am, after settling down 52 cents at $82.66 the previous day. London Brent crude fell 36 cents to $81.15.
Crude is on track to post a gain of 3.7% this week.
Oil broke a a 10-day winning streak on Thursday, falling from a 15-month high on a stronger dollar and as signs of tighter monetary policy in China stoked worries about demand in the world’s No. 2 oil user, and one of the main engines in oil demand growth last year.
China’s central bank surprised investors by raising the interest rate in a three-month bill auction on Thursday, which the markets took as a signal of policy tightening, putting pressure on commodities.
“Oil has had a very strong rally in the last two weeks, and I think it will be tied around $83-$84 in the near term, depending on how the data turns out. The cold weather factor appears priced in, and there’s definitely no shortage on the supply side out there,” McGuire said.
Frigid weather in the United States, Europe and parts of northern Asia remains a supportive factor. Temperatures should remain well below normal throughout much of the US into the weekend, before moderating readings push eastward, according to private forecaster DTN Meteorlogix.
US heating fuel demand has surged some 21% above normal, while European energy demand has also risen, especially in Britain and France. Heavy snow and record low temperatures in China have prompted cities across eastern and central parts of the country to begin rationing power.
Two days of talks between Russia and Belarus on resolving an oil spat that had raised the prospect of disruptions to the European Union ended with no result, both sides said on Thursday.
Russia briefly cut oil supplies to Belarussian refineries in a dispute over pricing that raised the prospect of supply disruptions for European Union customers, helping to lift oil prices this week.
Comment E-mail Print Share
First Published: Fri, Jan 08 2010. 09 48 AM IST
More Topics: Markets | Oil | Commodities | Crude Prices | Gasoline |