Oil falls on generous supplies, stronger dollar

GMT 20:55 2014 Friday ,03 October

Arab Today, arab today Oil falls on generous supplies, stronger dollar

Pump jacks are seen at dawn in an oil field near Lost Hills
New York - AFP

Global oil prices fell Friday, with the US contract hitting a 17-month low amid ample supplies on the market and the dollar strengthening following a positive US jobs report.
The US benchmark futures contract, West Texas Intermediate for November delivery, closed at $89.74 a barrel, down $1.27 from Thursday. It was the first time WTI closed below $90 since April 2013.
Brent North Sea crude for November, the main European contract, slumped $1.11 to $92.31 a barrel, its lowest close since June 2012.
The positive US jobs report, generally considered a sign of health in the world's largest crude-oil consumer, was not powerful enough to lift the market.
The Labor Department reported Friday that the US economy added 248,000 jobs in September and revised higher job gains in previous months, pushing the unemployment rate down to a six-year low of 5.9 percent.
The unemployment number was "very strong," said Carl Larry of Oil Outlooks and Opinion, "but for now, the big picture for the oil prices is the situation of supply, of oversupply, not in the US but everywhere else in the world."
Oil production in the United States is booming, thanks to oil shale extraction, and exports are on the upswing in Russia, Libya and Kurdistan. Key exporter Saudi Arabia also cut oil prices for the fourth straight month this week to defend its market share.
In the third quarter of 2014, both Brent and New York oil prices have shed approximately 15 percent of their value on generous supplies and slowing consumption growth.
Oil prices have also been under pressure from a rising dollar, which hit a fresh four-year high against the euro on Friday helped by the jobs report.
The dollar firmed to $1.2501 against the euro, a level last seen in late August 2012, and remained close to a six-year high against the yen.
A stronger greenback makes dollar-priced commodities more expensive for buyers using weaker currencies, which tends to dent demand and push prices lower.

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