MW: Oil futures on track for fourth day of declines
By Sara Sjolin, MarketWatch
LONDON (MarketWatch) — Oil futures were on track to for a fourth consecutive daily fall on Friday, as a firmer dollar and demand concerns pushed prices lower, while jobs data out of the U.S. later in the day was expected to be the main event.
Oil for January delivery CLF3 -0.28% dropped 22 cents, or 0.2% to $86.05 a barrel.
The drop built on a $1.62 decline from Thursday, as worries over the outlook for energy demand sent prices below $87 a barrel.
Friday’s move came as economic data out Europe gave investors several reasons to be worried about growth in the region. German industrial production fell more than expected in October, exacerbating concerns about future growth in the region’s powerhouse following growth-forecast downgrades by the Bundesbank Friday morning. See: Some bad news about that German engine of growth
“Demand concerns are back on the agenda and are set to dominate trading for the time being as crude continues to take its cue from macro headlines,” said Andrey Kryuchenkov, commodity analyst at VTB Capital in a note.
“At the same time, supplies are very comfortable indeed and fundamentally little changed over the past month,” he said.
Meanwhile, concerns of early elections in Italy drove down the euro, pushing up the dollar and adding pressure on dollar-denominated commodities. The ICE dollar index DXY +0.36% rose to 80.43 from 80.250 in late North America trade on Thursday. See: Political risk rises as Italy’s Monti feels the heat
Oil investors were further awaiting a closely watched jobs report from the U.S. due later in the day, to help gauge the health of the U.S. economy.
Analysts polled by MarketWatch expected 80,000 jobs to have been generated in November, while the unemployment rate is likely to hold steady at 7.9%. See: How to read the Sandy-impacted jobs report
Elsewhere in the energy complex, heating oil for January delivery HOF3 -0.05% inched 0.1% lower to $2.94 a gallon, while gasoline for the same month RBF3 +0.48% gained 0.4% to $2.61 a gallon.
January natural gas futures NGF13 -0.68% dropped 0.4% to $3.65 per million British thermal units.
Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin.
