Strong US Jobs Data Pushed Oil Futures Prices Higher
Oil futures prices increased after strong data on U.S jobless claims raised expectations for crude demand, while increasing tensions between Syria and Turkey kept on supporting prices as well.
On the NYMEX, the crude price per barrel of the U.S. Benchmark, for delivery in November, grew 1.2 percent to $92.33. On Europe’s ICE Futures Exchange, Brent had a 91-cent, or 0.8 percent, growth to $115.24 per barrel.
According to the Labor Department, the number of workers in the United States that filed for unemployment benefits dropped 30,000 to a seasonally adjusted rate of 339,000 during the previous week. The amount of new applications expected by economists was 365,000.
Even though the data may have been possibly skewed, commodities and equities increased broadly upon the release of the data.
The economy’s recovery will be the most significant factor for the price of oil, according to President Carl Larry of Oil Outlooks and Opinions. In case the statistics continue to appear positive, current oil prices may eventually reach $110 due to the economy and the increasing Middle Eastern tensions.
Further boosting prices of oil was news that Turkey forced down a passenger plane from Syria suspected of carrying weapons from Russia. The two nations have been exchanging fire across their border, increasing concerns that Syria’s civil war was spreading to neighboring countries.
Even if neither country is a primary producer of oil, conflict in the region has strengthened oil prices since the Arab Spring seized the Middle East last year, threatening the supply of oil from most of the large producers of the region. Turkey, for one, includes the port of Ceyhan, through which almost 400,000 barrels of crude from Iraq flows each day. Traders are also concerned of a bigger conflict surrounding the region, possibly drawing in Iran.
The rally in current oil prices is the most recent price swing overtaking the crude market in recent weeks. They have been caught between supply interruption worries pushing costs higher and poor demand pulling the industry lower. Recently, the crude price per barrel on the NYMEX fell 1.2 percent due to demand worries.
The Energy Information Administration is anticipated to release a weekly supply report indicating that US oil stockpiles increased 600,000 barrels in the past week. Gasoline inventories are anticipated to drop 400,000 barrels, while distillate supplies are seen declining 600,000 barrels. Refinery utilization is anticipated to shed 0.1 percentage point to a capacity of 88.1 percent.