Front-month crude futures gained a dollar Thursday after reversing earlier losses on a weaker greenback. Light sweet crude settled at $108.11 a barrel, up 0.9 percent.
Prior to the dollar's decline, the oil futures price fell to $105.77 during floor trading. The dollar fell against the euro on the U.S. Government's hovering budget battle and reports indicating an increase in jobless claims last week. According to the Department of Labor, applications for initial unemployment benefits soared to their highest level in two months. The Thursday report showed that 412,000 people had applied for claims, reflecting an increase of 27,000 from the previous week.
A weaker dollar increases the appeal of commodities, making it cheaper to purchase with other currencies. The dollar index, which compares the greenback to a basket of foreign currencies, also traded lower at 74.698 Thursday.
Meanwhile, political turmoil continues in the Middle East. Analysts believe Libya's structural problems will not be resolved in the near future but will continue to halt the country's previous exports of 1.5 million barrels a day.
Government reports of an increase in U.S. stockpiles pressured natural gas prices to rise by more than 2 percent Thursday. Prices settled at $4.212 per thousand cubic feet.
The Energy Information Administration (EIA) reported that U.S. gas inventories increased by 28 billion cubic feet last week. As of April 8, stockpiles were 0.6 percent above the five-year average at 1.607 trillion cubic feet.
The intraday range for natural gas was $4.06 to $4.26 per thousand cubic feet.
Gasoline prices lost 0.2 percent, settling at $3.23 a gallon. Thursday's gasoline futures peaked at $3.268, before bottoming out at $3.21.
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