Oil Shaves $1, Retreats to Bear Territory on US Dollar Spike
NEW YORK, Oct 3 (Reuters) - Global crude oil prices extended a months-long rout into bear market territory on Friday, with Brent notching a new 27-month low as the dollar spiked following upbeat U.S. employment data and further signs of undiminished crude supply.
The rallying U.S. dollar has re-emerged as a key driver for commodity prices in recent months, making raw materials more costly for most importers and reviving a once-popular spread trade. It reached a more than four-year peak on Friday after a report showing the U.S. economy created more jobs than expected last month, putting unemployment at a six-year low.
Brent for November delivery fell by $1.11 to settle at $92.31, after earlier touching $91.48 a barrel, its lowest since June 2012. It lost 5.1 percent on the week, its steepest weekly loss since April 2013. It was the fourth week in five that the international benchmark has settled lower.
Brent has fallen by more than 20 percent since June, when it climbed near $116 following the incursion of Islamist militants into Iraq.
U.S. November crude fell by $1.27 to settle at $89.74 a barrel. It has lost around $2 this week, its steepest weekly fall in a month.
"The surging dollar is the primary driver pressing us back down again," said John Kilduff, a partner at Again Capital LLC in New York.
He also cited rising production from Russian oil fields emerging from maintenance, and a report from this week showing OPEC production hitting two-year highs of 31 million barrels per day (bpd)in September.
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