Hunt


Sponsored By:

   The Nation  |  Business  |  Equipment  |  Features


Oil drops below $93 on unemployment claims data

The Associated Press

4/4/2013

NEW YORK — The price of oil dropped sharply for a second day after the government said the number of people seeking unemployment aid in the U.S. reached a four-month high.

At midday in New York, benchmark oil for May delivery was down $1.80, about 2 percent, to $92.65 a barrel. Oil hadn't dropped below $93 a barrel in two weeks. It fell $2.74, or 2.8 percent, on Wednesday. That was the biggest one-day decline since November.

The number of Americans seeking unemployment benefits rose last week by 28,000, the third straight increase, according to the Labor Department. Weekly applications increased to a seasonally adjusted 385,000. That's the highest level since late November.

Applications are a proxy for layoffs, so any indication that fewer people are making the daily commute can be interpreted as a sign of lower demand for gasoline as well.

Oil prices also fell back because of the stronger dollar, which makes crude more expensive and a less attractive investment for traders using other currencies.

The dollar has risen partly because of a big drop in the yen after the Bank of Japan announced an aggressive monetary easing campaign. Looser monetary policy tends to weaken a country's currency. The dollar rose to 96.06 yen, up more than 3 percent from 92.84 yen Wednesday.

Wholesale gasoline futures fell 1 cent to $2.90 a gallon and have dropped about 7 percent so far this week. Phil Flynn, senior market analyst at Price Futures Group, wrote in a daily report that he believes the decline will put American drivers "in much better shape as we head into this summer driving season."

Brent crude, used to price many kinds of oil imported by U.S. refineries, fell $1.27 to $105.84 per barrel on the ICE Futures exchange in London.

In other energy futures trading on the Nymex:

— Heating oil fell 5 cents to $2.95 a gallon.

— Natural gas rose 4 cents to $3.94 per 1,000 cubic feet.

Pamela Sampson in Bangkok and Pablo Gorondi in Budapest contributed to this report.

 

The Trucker staff can be reached to comment on this article at editor@thetrucker.com.

Find more news and analysis from The Trucker, and share your thoughts, on Facebook.