Oil Slides As Dollar Jumps; Down More Than 4% On The Week
NEW YORK, Nov 6 (Reuters) - Oil prices fell as much as 2 percent on Friday, posting their third weekly decline in four, on pressure from a rallying dollar and higher interest rate expectations after strong U.S. jobs growth in October.
For the week, crude futures were down more than 4 percent, sliding since Wednesday after a sixth weekly build in crude stockpiles.
The dollar hit 6-1/2-month highs against a basket of currencies after data showed the U.S. jobs market grew in October by its most in a month since December 2014.
The spike in employment bolsters the chance for a U.S. rate hike in December that could add to the dollar's strength, making commodities denominated in the greenback less affordable to holders of other currencies.
"The jobs number may be strength for the U.S. economy but it's being interpreted as weakness for oil," said Pete Donovan, broker at Liquidity Energy.
Brent, the global benchmark for oil, settled down 56 cents, or 1.2 percent, at $47.42 a barrel. It fell 4.2 percent on the week.
U.S. crude finished down 91 cents, or 2 percent, at $44.29. It tumbled 5 percent on the week.
The discount in December spot U.S. crude to January
The discount, or "contango," comes as traders keep immediately available oil in storage to deliver later at better prices.
"Long liquidation at the front of the curve, or the rolling forward of long positions from December into January can be widening the spread," said Tim Evans, energy futures specialist at Citigroup.
The spot contract was at a contango of more than $6 to December 2016
The market took the U.S. government's rejection of the proposed Canada to U.S. Keystone XL pipeline project in stride.
There was also no positive reaction to data showing a 10th weekly decline in the U.S. oil rig count.
Next week, traders will be looking for guidance from monthly data issued by the U.S. Energy Information Administration (EIA), the Organization of the Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA).
"The EIA data, which is expected to shows builds, coupled with no action expected from OPEC to cut supplies, will only highlight oil's fundamental weakness," said Chris Jarvis, analyst at Caprock Risk Management.
(Additional reporting by Liz Hampton in Houston, Libby George in London and Henning Gloystein in Singapore; Editing by Marguerita Choy and Chris Reese)
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