Commodity Corner: Oil Down on Bernanke Comments
Oil futures plummeted Thursday after Federal Reserve Chairman Ben Bernanke stifled expectations of the Federal Reserve providing additional monetary aid. During the Fed's semiannual policy report, Bernanke explained that as of now, the central bank would not be releasing further funds.
The news sent the dollar soaring. A stronger greenback pressures oil prices making the dollar-denominated commodities more expensive for foreign buyers.
Easing the drop in prices, the U.S. Labor Department reported that the number of claims for unemployment benefits decreased by 22,000—the lowest in three months. In spite the decrease, application levels remain above 400,000, representing a weak job market.
In early trading, crude futures rose as high as $98.88 a barrel, before settling at $95.69 on the New York Mercantile Exchange (NYMEX).
Front-month Brent ended the August contract at $118.32 a barrel on the ICE Futures exchange. The intraday range for Brent crude was $117.73 to $119.40 a barrel.
Meanwhile, natural gas for August delivery lost 2.9 cents to end Thursday's session at $4.36 per thousand cubic feet. According to the U.S. Energy Information Administration, natural gas inventory grew by 84 billion cubic feet. Prices peaked at $4.41 and bottomed out at $4.25 Thursday.
Reformulated August gasoline blendstock also traded lower, settling at $3.12 a gallon. Gasoline futures traded between $3.094 and $3.159 Thursday.