Commodity Corner: Crude Falls as Jobless Claims Increase
An increase in jobless claims contributed to bearish sentiment among oil traders Thursday.
September crude oil futures lost 46 cents to settle at $82.01 a barrel after the U.S. Labor Department reported that new seasonally adjusted initial claims for unemployment insurance rose by 19,000 last week. The additional jobless claims brings the total figure for first-time unemployment insurance requests to 479,000. An increase in unemployment reduces the number of commuters on the road, consequently dulling demand for gasoline. Friday's highly anticipated monthly job report will be the key indicator to economic growth.
The intraday range for oil was $81.56 to $82.48.
Despite a lower-than-expected build in natural gas inventories for the week ending July 30, natural gas futures settled 3% lower Thursday. Natural gas settled at $4.60 per thousand cubic feet after fluttering from $4.56 to $4.83 during the day's trading. According to the Energy Information Administration, total working gas in underground storage stood at 2,948 billion cubic feet last week -- a 29-Bcf increase from the previous week. During the corresponding period in 2009, inventories were 132 Bcf higher. Compared to the five-year (2005-2009) average for the period, the amount of gas in storage last week was 221 Bcf higher.
The price of a gallon of gasoline for September delivery also ended the day lower, settling at $2.16. Gasoline fluctuated from $2.14 to $2.17.