Crude Oil Price: $95.16
Crude-Oil Futures Settle up 86 Cents at $95.16/Barrel
Crude-oil futures prices settled higher Thursday, climbing on hopes for rising demand as the peak summer gasoline demand season approaches.
Prices also were propped up early by weakness in the dollar after disappointing U.S. economic data, including a bigger-than-expected rise in new claims for jobless benefits and a sharp drop in housing construction.
While the data suggest a sputtering recovery in the U.S. economy, which could keep limit demand growth in the world’s biggest oil consumer, analyst said it was, conversely, sending bullish signals to the oil market.
“We had bad data across the board, but that just means the Fed will continue the stimulus and that is supportive for the market,” said Gene McGillian, broker and analyst at Tradition Energy.
Light, sweet crude oil for June delivery on the New York Mercantile Exchange settled 86 cents higher, at $95.16 a barrel. ICE North Sea Brent crude for June delivery expired 12 cents higher, at $103.80 a barrel.
Traders said the market is looking beyond signs of oversupply and weak demand and hoping for a shift in fundamentals as the peak summer driving season nears.
U.S. crude oil stocks stand near their highest level since April 1981, and demand for gasoline was weak ahead of summer driving season, while inventories have climbed.
Carl Larry, analyst at Oil Outlooks and Opinions, said traders appear to be looking beyond weekly oil inventory data with a hope that gasoline use will pick up in the summer months and that refiners will need to pare down crude oil stocks to meet consumer needs.
The Energy Information Administration projects gasoline demand will slip to a 12-year low during the peak spring-summer driving season. But demand is expected to rise seasonally to 9 million barrels a day, on average, in June-August, compared with the 8.34 million barrels a day reported by EIA for last week.
Reformulated gasoline for June delivery settled up 1.52 cents, at $2.8822 a gallon, but down from an earlier one-month intraday high. June heating oil settled 2.86 cents higher, at $2.9087 a gallon.Read More
Crude Oil Price: $96.62
US Crude Oil Futures Settle Down; Products Hit One-Month High
U.S. crude oil futures ended weaker but above the day’s lows, while refined products futures hit one-month highs on hopes of a coming improvement in the economy of the world’s biggest oil consumer.
Oil traders looked beyond the highest stocks of U.S. crude oil in 32 years, and the current sluggish growth in fuel consumption, to bid up prices late in the session. Analysts said the rally was spurred by the hope that strong indicators from the U.S. market would jump-start sputtering oil demand.
The Labor Department’s count of new weekly claims for unemployment benefits came in lower than economists had forecast, while a widely watched indicator of layoffs fell to prerecession levels for the first time. The four-week average of benefits claims dropped to the lowest level since November 2007.
“There’s a little bit more optimism there, but I think we have to see it play out a little longer,” said Gene McGillian, broker and analyst at Tradition Energy.
Light, sweet crude oil for June delivery on the New York Mercantile Exchange settled down 23 cents, at $96.39 a barrel, but up more than $1 from the session low of $95.35.
June Brent crude oil on the InterContinental Exchange shed earlier losses to settle 13 cents higher, at $104.47 a barrel.
Brent’s premium to the U.S. benchmark was $8.08 a barrel at the settlement, up from $7.72 a day earlier, which was the lowest level since Jan. 20, 2011.
Brent’s premium to the U.S. benchmark has narrowed considerably as rapidly rising domestic crude oil output makes its way to the key Gulf Coast refining region, displacing imports of Brent and similar crudes.
Refiners are shipping oil from the midcontinent to the Gulf by truck and rail, as well as pipelines, chipping away at the supply surplus in landlocked Cushing, Okla. Oil inventories at the hub, which is the delivery point for the Nymex futures contract, have fallen by 2 million barrels in the past two weeks. The year-on-year surplus has dropped to 5 million barrels from nearly 24 million barrels in January.
As the regional bottleneck eases, the Brent premium has narrowed to near $8 a barrel, from $17 a barrel early this year.
Crude prices had been under pressure from government data showing stocks rose modestly last week to the highest level since April 1981. The Energy Information Administration also said in its weekly oil supply/demand report Thursday that demand for gasoline, the most widely used petroleum product in the nation, dropped by 400,000 barrels a day last week from the year-earlier level. The 4.7% drop was the biggest at the early May start of the driving season since 1994.
But traders said there is widespread hope that increasing refinining activity will reduce the deep inventories and that a pickup in the economy will boost demand for refined products, even as the EIA sees summer gasoline use slipping to a 12-year low in the peak spring-summer driving season.
In June, the EIA projects crude oil processing at refineries will average 15.6 million barrels, up about 440,000 barrels a day above current levels, and crude stocks will fall by about 12 million barrels by the end of June, to just below year-earlier levels. Stocks are now above the year-earlier level by 16 million barrels, or 4.2%.
Tim Evans, analyst at Citi Futures, warned that these expectations make for “a weak bullish arguement” because if fuel demand doesn’t improve, the problem of high crude oil stocks is simply shifted in the refined products market.
June heating oil futures settled 2.19 cents higher, at $2.9366 a gallon, the highest level since April 10.
Reformulated gasoline blendstock futures for June delivery settled at the highest level since April 9, gaining 3.13 cents, to $2.8851 a gallon.Read More
Crude Oil Price: $93.99
Crude-Oil Futures Post Biggest Rise in Five Months
Crude-oil futures jumped 3.3% Thursday to settle at $93.99 a barrel, as a combination of economic signals overcame worries about weak oil demand and high inventories.
Traders said prices were due for a rebound after both the U.S. and European benchmark crudes shed 3.7% over the previous two days on signs of sluggish demand growth in the U.S. and China, the world’s top two oil consumers.
The oil rally was slow to start, despite a move by the European Central Bank to cut its main refinancing rate by 25 basis points and news that new claims for U.S. unemployment benefits hit a five-year low in the latest week. But strength in U.S. equities prices sparked a risk-on sentiment that spurred oil-market players to jettison worries about an oversupplied market, including the highest U.S. crude stocks since 1981.
The Standard and Poors 500-share index posted its biggest gain since April 23 and closed at a record high.
“The equities are pushing higher and we’re seeing some carry over into crude,” said Gene McGillian, analyst and broker at Tradition Energy.
Traders said the market’s hope is that the strong signal from the latest U.S. weekly jobs figure will translate into a healthy showing in Friday’s widely watched figure for April non-farm payrolls.
Light, sweet crude oil for June delivery settled 3.3%, or $2.96 higher, at $93.99 a barrel. The gain was the biggest single-day rise since Nov. 6, 2012. But prices still are 51 cents below Monday’s settlement.
ICE June Brent crude settled 2.9%, or $2.90 higher, at $102.85 a barrel. Brent’s rise also was the biggest since Nov. 6.
“I don’t think anyone thinks that everything is full-speed ahead in the global economy now. We are in a near-term range of $85-$98 a barrel and we can see a $1 or $2 move without any problem,” Mr. McGillian said.
“If you look solely at the supply figures, we should be falling out of bed,” said Phil Flynn, analyst at Price Futures. But he said moves by the ECB, the U.S. Federal Reserve and the Bank of Japan to add stimulus to the market were overwhelming the poor market fundamentals.
Data from the Energy Information Administration, released Wednesday, showed that U.S. implied demand for gasoline fell 3.8% last week to its lowest level at the end April in 10 years. Inventory levels are now sufficient to cover 25.7 days of current weak demand, the highest level of cover in end April since 1999.
June-delivery reformulated gasoline futures settled up 2.3%, or 6.13 cents higher, at $2.7806 a gallon. The contract fell 3% Wednesday, its biggest one-day drop in four weeks, in response to the EIA data. In a sign of the scope of recent market volatility, the sharp rise was on the second-largest in the past week, as then-front-month May futures climbed 6.44 cents a gallon on April 25.
June heating oil settled up 2.4%, or 6.66 cents higher, at $2.855 a gallon. Heating oil posted the biggest one-day dollar and percentage gain since Nov. 19, 2012 in snapping a four-day losing streak.Read More
Crude Oil Price: $93.64
Crude Oil Futures Settle at Two-Week Highs on Supply Concerns
Crude-oil futures prices settled at two-week highs Thursday on concerns over tightening supplies, while U.S. gasoline demand heats up ahead of the peak spring-summer driving season.
Traders said weakness in the dollar, rising equities prices and news that U.S. weekly claims for jobless benefits fell to the lowest level in nearly five years added to buying interest.
“There are a bunch of things going on. There does seem to be some risk-on buying in the last couple of days,” said Andy Lebow, senior vice president for energy futures at Jefferies Bache. Mr. Lebow and others said oil-market investors are sensing that oil demand in the U.S. will be stronger in the near term than elsewhere and are favoring the U.S. benchmark futures contract over internationally traded North Sea Brent crude.
Implied demand for gasoline–the most widely used petroleum product in the world’s biggest oil consumer–climbed to its highest level since November last week, U.S. government data showed. Gasoline stockpiles logged their biggest drop in a year, breathing new life into futures contracts that fell to a four-month low in recent days.
“People have been so down on demand. Whether it’s a fluke, or seasonal, it doesn’t really matter. There is a perception that demand is getting better,” said Phil Flynn, analyst at Price Futures.
The EIA has forecast that gasoline demand will be slightly down this spring-summer from a year-earlier and drop to a 12-year low. But the near-term strength is spilling over into crude oil prices, on expectations that refiners will use more to turn out more refined products.
Light, sweet crude oil for June delivery on the New York Mercantile Exchange climbed 2.4%, or $2.21 a barrel, to $93.64 a barrel, the highest price since April 10. The rise followed a 2.5% gain on Wednesday that was the biggest rise for the year.
June Brent crude oil on the InterContinental Exchange rose 1.68 a barrel, or 1.7%, to $103.41 a barrel, a two-week high. The gain was the biggest since Dec. 26.
Brent’s premium to the U.S. benchmark was $9.77 a barrel at the settlement, the smallest since Jan. 3, 2012. The spread topped $23 a barrel as recently as early February, but surging U.S. oil output, now at a 21-year high above 7.3 million barrels a day has cut deeply into U.S. crude imports, shrinking Brent’s value to the U.S. benchmark.
New technologies such as hydraulic fracturing and horizontal drilling have unlocked vast oil reserve trapped in shale, pushing U.S. output higher by 20% this year and by 1.2 million barrels a day from a year ago. Imports have dropped by as much as domestic output has risen, as crude supplies make their way to the Gulf Coast refining hub, eliminating the need for foreign barrels which compete with Brent.
Brent found support Thursday from a Reuters report quoting industry sources saying that work on a gas pipeline will cut crude oil output from the seven-field Norwegian Ekofisk complex for three weeks this June. Ekofisk produces around 170,000 barrels a day of crude.
Buoyant gasoline future found further strength from a fire at a unit of a Louisiana refinery that makes octane enhancers for gasoline.
The fire, at a reformer unit at Alon USA Energy Inc.’s 83,000-barrels-a-day Krotz Springs, La., was quickly extinguished, the company said. But the impact on operations at the plant isn’t yet clear.
Nymex May reformulated gasoline futures posted their biggest gain since March, rising 6.44 cents, or 2.3%, to settle at $2.8118 a gallon, a two-week high.
Heating oil for May delivery rose for a sixth straight session, settling 6.04 cents, or 2.1% higher, at $2.9017 a gallon. The rise was the biggest since Nov. 19, 2012, and put prices at a two-week high. The heating oil contract trades as a proxy for ultra-low sulfur diesel fuel, which fuels trucks and trains.Read More
Crude Oil Price: $87.73
Crude Oil Settles Higher on Bargain Buying after Recent Sharp Drop
Crude-oil futures prices settled higher Thursday amid bargain-hunting after a recent steep selloff, with North Sea Brent posting its first gain after six down days.
News of lower exports of Nigerian crude oil buoyed prices of European benchmark Brent crude, which had tumbled in the past six session to its lowest level since July 2. Royal Dutch Shell’s (RDSA, RDSA.LN) Nigerian unit said it cut output of Bonny Light crude oil by 150,000 barrels a day and halted exports in order to resolve issues with a key oil pipeline.
Traders said an extended outage in shipments of the Brent lookalike would underpin prices of the European benchmark. But the overall supply-demand picture for oil remains weak, amid stuttering signs of economy recovery in the U.S., the world’s biggest oil consumer.
“We are a slave to the economy right now and the picture’s not particularly great,” said Carl Larry, analyst at Oil Outlooks and Opinions.
June North Sea Brent crude oil futures on the InterContinental Exchange settled 1.5%, or $1.44, higher at $99.13 a barrel, after six days of declines. The June contract traded in a high-low range of near $10 a barrel since April 10, dropping 8%, or nearly $8.50 a barrel in the period.
May-delivery light, sweet crude oil futures on the New York Mercantile Exchange settled 1.2%, or $1.01 higher, at $88.20 a barrel, after settling Wednesday at a four-month low.
U.S. benchmark crude has dropped by more than $10 a barrel from highs in early April, as domestic crude oil and gasoline inventories have climbed, while demand for fuels remains sluggish. Front-month Brent, has fallen by about $12 a barrel this month, and the three-day string of prices below $100 a barrel is the longest since June 2012.
“We’ve lopped off $12 and it looks like we’re wrapping up the selloff and starting to stabilize here,” said Gene McGillian, broker and analyst at Tradition Energy. “But it’s not that all of sudden we have confidence that the economy is improving.”
The Labor Department said Thursday the number of U.S. workers applying for jobless benefits last week rose by more than economists had expected. Elsewhere, the Conference Board said its index of leading economic indicators posted an unexpected fall in March, as consumers turned gloomy on the economic outlook. The index declined 0.1% in March, its first fall since August, and counter to an expected 0.2% rise recorded in a survey of economists by Dow Jones Newswires.
U.S. gasoline demand dropped to a one-month low and was the lowest for the second week in April in 16 years, government data released on Thursday show. Demand of 8.383 million barrels a day last week was nearly 400,000 barrels a day below the year-earlier level.
The Energy Information Administration forecasted last week that gains in fuel-efficient vehicles will trim spring-summer driving season demand this year to a 12-year low of 8.877 million barrels a day.
Nymex May reformulated gasoline blendstock futures posted the first gain after falling 12%, or 37.25 cents in five of the previous six sessions to a three-month low. The contract settled up 2.65 cents, or 1%, Thursday, at $2.7555 a gallon.
Nymex May heating oil futures settled 4.45 cents, or 1.6%, higher, at $2.7791 a gallon. Prices fell 7.7% over the previous six days to the lowest level since July 2012.Read More
Crude Oil Price: $94.64
Crude Oil Slips as Demand Outlook Weakens
U.S. crude-oil futures fell Thursday as slumping gasoline prices and forecasts for weaker global demand weighed on the oil market.
Light, sweet crude for May delivery settled $1.13, or 1.2%, lower at $93.51 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange fell $1.60 to $104.19 a barrel.
Oil declined in tandem with gasoline futures, which settled at the lowest level since January as traders continue to flee from rising domestic supplies. Reformulated gasoline blendstock, or RBOB, has fallen 8.8% in April, and settled 3.41 cents lower Thursday at $2.8310 a gallon.
On Wednesday, the U.S. Energy Information Administration said U.S. gasoline stockpiles rose 1.7 million barrels last week. Imports to the U.S. East Coast rose 64% from the week earlier period to the highest levels since August, and stockpiles in this high-demand region are now 5.4% above the five-year average level for this time of year.
“You’ve got flat U.S. demand and growing production,” said Andy Lebow, an oil broker at Jefferies Bache in New York. “The market’s reached this moment, it’s a moment of clarity” about high supplies, he said.
Oil futures have fallen for most of 2013, and after peaking in March U.S. gasoline prices have also tumbled. Refineries that shut down earlier this year for scheduled maintenance periods have started to ramp up operations, churning out more fuel despite tepid demand from drivers.
Weak gasoline demand is helping to lower prices at the pump. National average retail regular gasoline prices fell to $3.564 a gallon Thursday, according to the daily AAA Fuel Gauge Report. Prices are down from $3.703 a gallon a month ago.
Still, dimmer prospects for fuel use aren’t confined to the U.S. The International Energy Agency, which represents a group of the world’s largest oil-consuming countries, cut its forecast for 2013 oil-demand growth by 25,000 barrels a day to 90.6 million barrels a day due to falling fuel use in industrialized countries, particularly in Europe.
The IEA’s revised outlook follows similar reports this week from the Organization of the Petroleum Exporting Countries and the Energy Information Administration. Both groups cut their forecasts for world oil-demand growth this year.
A weaker outlook on fuel usage this year, coupled with surging U.S. production and an improving supply outlook in other regions, is keeping a lid on global oil prices.
May heating oil settled 4.88 cents lower Thursday at $2.8991 a gallon.Read More
Crude Oil Price: $93.26
Crude-Oil Futures Slide on US Jobs Data, Rising Inventories
Crude-oil futures prices slid for a second day Thursday, hit by rising U.S. oil supplies and new worries about economic recovery in the world’s biggest oil consumer.
After a steep 2.8% drop Wednesday after news that U.S. crude-oil stocks climbed to their highest end-March level since 1931, crude prices shed a further 1.3% after U.S. initial claims for jobless benefits rose by more than expected last week, reaching their highest level since November.
The setback in the jobs picture presents further worries about the potential for the already slim growth expected in U.S. oil demand this year. The Energy Information Administration sees U.S. oil use up a fractional 0.2% this year, following last year’s drop to a 16-year low.
Light, sweet crude oil for May delivery on the New York Mercantile Exchange fell $1.19 to settle at $93.26 a barrel, a two-week low. Crude fell intraday to a low of $92.12 a barrel, down $5.68, or 5.8%, from the session high of $97.80 hit Monday. The U.S. benchmark shed $3.93, or 4%, over the past two trading days.
ICE North Sea Brent crude oil settled 77 cents lower, at $106.34 a barrel, the lowest price since early November. Brent shed $4.74, or 4.3%, a barrel in the past two days, stung by increased output and greater competition between rising domestic U.S. oil supplies and imports in the key U.S. Gulf refining hub.
The sharp reversal in prices comes as money managers are stepping away from heavy bets on rising prices as supplies are increasing and economic worries threaten demand growth.
“The primary driver is the economic outlook, and how that’s going to play out is a tough question to answer,” said Gene McGillian, broker and analyst at Tradition Energy. “Until we see signs of economic improvement we’re like to be between $90-$95″ a barrel, he said.
U.S. crude oil prices could drop to five-month low of $85 a barrel in coming weeks, if money managers cut heavy bets on higher prices, said Citi Futures analyst Tim Evans, who also sees potential for Brent to fall to a nine-month low near $100 a barrel.
“We have seen a lot of speculative froth come into the market recently,” said Kyle Cooper, analyst at IAF Advisors. Money managers lifted their net long position in Nymex crude futures and options by 16% last week, helping drive prices to the seven-week intraday high of $97.80 a barrel hit Monday.
U.S. crude oil stocks rose by 2.7 million barrels, nearly twice the expected level, last week to 388.6 million barrels, according to the federal Energy Information Administration. EIA data show stocks are the most at the end of March since 1931 and are the highest in any week since July 1990.
Early data show refiners boosted crude oil processing to its highest March level in six years, meaning inventories of refined products such as gasoline and diesel fuel are expected to be ample as the spring-summer driving season approaches.
By lifting crude oil runs to the highest level since early January, refiners are erasing earlier worries about potential tight supplies and sending prices lower.
When refinery operating rates dropped to two-year lows in early March, reformulated gasoline futures climbed to a six-month high near $3.27/gallon. With crude runs up by 7% from a month ago, RBOB futures prices have tumbled by 12%, or 40 cents a gallon, in the past four weeks.
May-delivery reformulated gasoline settled 1.53 cents lower, at $2.8987 a gallon Thursday, the lowest price since Feb. 27. The contract has dropped 6.8%, or 21.2 cents, in the past five sessions.
May heating oil settled 3.84 cents, or 1.3%, lower at $2.9636 a gallon Thursday and has fallen 12.4 cents, or 4%, in the past two sessions.Read More
Crude Oil Price: $96.58
Oil Futures Finish Higher as S&P 500 Aims for Record
Oil futures finished higher Thursday, setting a six-week high as the Standard & Poor’s 500 was poised to finish at a record.
Light, sweet crude for May delivery settled 65 cents, or 0.7%, higher, at $97.23 a barrel on the New York Mercantile Exchange. That’s the highest settlement since Feb. 14.
Brent crude on the ICE futures exchange settled 33 cents, or 0.3% higher, at $110.02 a barrel.
Futures rallied as the benchmark S&P 500 pushed higher and was set to surpass its previous record set in October 2007. The index recently rose 0.3%, to 1567.08.
“The stock-market record for the S&P is chipping in here,” said John Kilduff, founding partner at Again Capital in New York. “It’s a risk-on day.”
Oil futures and equities often trade in tandem since both are considered risky assets that investors use as a bet on economic growth. In addition, crude traders often turn to equities as a barometer of broader economic sentiment.
Despite Thursday’s strong stock market performance, several reports put a damper on the crude market earlier in the session, keeping it in negative territory for much of the morning.
Jobless claims rose by a bigger-than-expected 16,000 to a seasonally adjusted 357,000 last week. The figure was the second straight weekly increase in the filing of unemployment benefits, underscoring the weak pace of hiring in the U.S.
Meanwhile, the U.S. government released its final revision on fourth-quarter economic growth, saying the U.S. grew at an annualized rate of 0.4%, below the 0.5% rate forecast by economists.
“The jobs numbers today were not very inspiring and GDP was kind of in line,” said Phil Flynn, analyst at Price Futures Group, a brokerage in Chicago.
Nymex crude prices have notched gains of roughly 6% so far in March. But analysts have attributed the rally to expectations that the supply glut in the central U.S. had begun to ease, lifting prices there.
The price of Brent crude, regarded as a more reliable global benchmark, is down about 1.2% in March.
Front-month April reformulated gasoline blendstock, or RBOB, settled 1.01 cent, or 0.3%, lower, at $3.1054 a gallon. April heating oil settled 0.02 cent lower at $2.9152 a gallon.
Crude Oil Price: $92.45
Crude Settles Lower on Cyprus Worries
Crude-oil futures prices settled weaker Thursday, knocked lower by concerns over the ongoing debt crisis in Cyprus and worries it could spread further into Europe.
Traders said high U.S. oil inventories and weak demand in the world’s biggest oil consumer also kept prices down.
The European Central Bank has warned it won’t extend beyond Monday the emergency funding that has kept Cypriot banks in operation while a bailout plan was being negotiated. The Cypriot Parliament rejected an earlier package that included a tax levy on bank accounts in the island nation, fueling fears of a run on banks, which have been ordered to close this week.
Worries about Cyprus sparked fears debt problems could flare anew elsewhere in Europe and have weighed on the euro, sending the common currency down against the dollar. In times of dollar strength, some investors using foreign currencies avoid dollar-based investments such as oil futures as they become pricier due to currency issues.
“Cyprus is completely unresolved” and people are becoming “a little more cautious” about buying crude-oil futures, said Peter Donovan, vice president at Vantage Trading.
Mark Waggoner, president of Excel Futures, said the oil market was overbought and in need of a correction. But he expects prices will recover once the market is no longer “spooked” over Cyprus. That front-month Nymex crude held above its 20-day average on trading charts of $92.29 a barrel signaled potential for recovery, he said.
Light, sweet crude oil for May delivery on the New York Mercantile Exchange settled 1.1%, or $1.05 lower, at $92.45 a barrel. May ICE North Sea Brent crude oil fell $1.25 to $107.47 a barrel.
For the second time this week, Brent’s premium to the U.S. benchmark narrowed to the lowest level since last July. The spread was $15.02 a barrel Thursday.
Brent crude supplies have been rising after output snags have been resolved, and are facing increased competition from higher flows of similar grades of oil from West Africa. Shell said Thursday it was restoring shipments of Bonny Light crude after a pipeline was shut earlier this month after being damaged in an attempted oil theft.
At the same, more U.S. outlook is making its way to the U.S. Gulf refining region by pipeline and rail, where it competes directly with imports, putting further pressure on Brent and similar crudes.
The Energy Information Administration reported Wednesday U.S. crude-oil stocks fell by 1.3 million barrels last week, while analysts expected a 1.7-million barrel rise. The surprise decline followed nine straight weeks of increases that plumped up inventories by 24 million barrels.
But even with the decline, crude stocks, at near 383 million barrels, are unusually high and 12% above the five-year average for this time of year, the biggest surplus in two months. At the same time, the EIA said U.S. oil demand dropped last week to its lowest level since January.
April-delivery reformulated blendstock gasoline futures settled 4.57 cents lower, at $3.0706 a gallon, while April heating oil rose 0.42 cent, to settle at $2.8963 a gallon.Read More
Crude Oil Price: $95.52
Crude-Oil Futures Rise as Jobs Data Sparks Gains
U.S. crude futures settled higher Thursday as investors cheered a reading on the U.S. labor market that pointed to further improvements in the broader economy.
Light, sweet crude for April delivery settled 51 cents, or 0.6%, higher at $93.03 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange for April delivery settled 90 cents higher at $109.42 a barrel.
The number of U.S. workers filing new applications for jobless benefits fell by 10,000 last week to a seasonally adjusted 332,000, the Labor Department said.
The drop was below the 350,000 new applications that economists expected in a Dow Jones Newswires survey, and was the fourth decline in five weeks.
Oil markets are often boosted by better readings on the labor market, as it signals growing activity in the broader economy. With more people heading to jobs, driving typically increases, thus boosting fuel demand.
Stock markets also rose, with the Dow Jones Industrial Average recently 65 points higher at 14520, which helped prop up crude prices, according to analysts and traders.
“It’s been mildly frustrating just watching broader markets, but that’s what’s been happening today,” said Matt Smith, an analyst at energy-consulting firm Schneider Electric. “Crude turned around on this jobless claims number along with other markets…Crude’s just being swept up in optimism.”
After falling to nearly $90 a barrel earlier this month, oil futures have bounced higher. But some market watchers are skeptical that futures will keep adding to recent gains amid weak global fuel demand and high supplies.
On Wednesday, the International Energy Agency slightly reduced its global demand outlook for 2013. The group sees oil demand growing by 820,000 barrels a day this year, down 200,000 barrels a day from its earlier forecast.
And in the U.S., the Energy Information Administration said Wednesday that domestic crude supply relative to refiner demand climbed to a 21-year high.
Front-month April reformulated gasoline blendstock, or RBOB, settled 0.10 cent lower at $3.1413 a gallon. April heating oil settled 0.53 cent, or 0.2%, higher at $2.9295 a gallon.Read More