BP spill among factors that could push oil to $90 a barrel in 2011, analysts say
By Polya Lesova, MarketWatch
FRANKFURT MarketWatch) -- Crude-oil futures extended their losses on Friday after the government reported that U.S. nonfarm payrolls declined by 125,000 in June, even as the unemployment rate unexpectedly dropped from the previous month.
Crude for August delivery fell 72 cents to $72.23 a barrel on the Comex division of the New York Mercantile Exchange.
The contract briefly hit an intraday low of $71.67 a barrel following the release of data from the Labor Department.
The unemployment rate dropped to 9.5% in June from 9.7% in May. This is the lowest level since July 2009.
Also, private-sector payrolls expanded by a modest 83,000 in June, lower than the 115,000 increase expected by economists polled by MarketWatch.
Total nonfarm payrolls tumbled 125,000 in June after surging 433,000 in May.
"The mix of data won't give clear direction to the markets and the bar was set pretty low, but we see the report on the weak side," said analysts at Action Economics.
Oil futures had posted steep losses on Thursday as various economic data rekindled worries over a slowdown in global growth and its potential impact on energy demand.
"Worse-than-expected U.S. economic data increased the concerns about an economic recovery and led to massive selling pressure on the commodity markets," said analysts at Commerzbank in a note published before the release of the jobs data.
In other energy news, Russia's oil production hit a record high in June and remained above 10 million barrels a day for the 10th month in a row, Reuters reported, citing an unnamed industry source.
This performance means Russia remains the world's top oil producer, ahead of Saudi Arabia, according to the report.
Meanwhile, some analysts say that the oil spill in the Gulf of Mexico could push oil prices higher. Read more.
