MW: Oil down more than 3% as growth fears boil over
Jobless claims report comes in worse than expected
By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures declined more than 3% on Thursday as fears of a global economic slowdown flared and the day’s jobs data reinforced such concerns.
Crude for September delivery CL1U -3.95% retreated $3.16, or 3.6%, to $84.44 a barrel on the New York Mercantile Exchange.
A close in the red would snap a two-day winning run for the commodity. Oil has declined nearly 9% so far this month and more than 4% for the year as concerns revolving around the euro zone’s sovereign-debt crisis and the U.S.’s anemic recovery keep investors worried demand for oil will be weak for some time to come.
Jobless claims data reported Thursday pointed at a still worrying labor market, one of the main concerns surrounding the slow recovery in the U.S.
Initial jobless claims in the week ending Aug. 13 rose 9,000 to 408,000, according to the Labor Department. The increase was larger than analysts had expected, with the consensus forecast around a rise to 400,000. Read more about jobless claims.
Oil tracked stocks on Wednesday, rising 1.1% and looking past a surprise increase in inventories reported by the Energy Information Administration. Supplies rose by 4.2 million barrels against expectations of a draw of 500,000 barrels. Read more about Wednesday's action in oil futures.
The EIA inventory data was bullish on gasoline, with stocks sliding 3.5 million barrels.
Rather than a sign of improving demand, however, “the drawdown stems from low imports of below 700,000 (barrels a day) while U.S. refiners are hiking distillate yields, with 4-week average diesel output recently hitting all-time highs,” analysts at JBC Energy said in a note to clients Thursday.
September gasoline RB1U -2.27% declined 6 cents, or 2.3%, to $2.80 a gallon.
