Oil slips on U.S. data, stock build
Oil prices slipped again on Thursday as doubts about the energy demand outlook grew after a jump in U.S. jobless claims and U.S. government data showing rising stockpiles of refined products.
The dollar was stronger after midday in a seesaw session, but the greenback's early weakness helped limit losses for crude futures, as did expectations of technical support for crude above $81 a barrel.
U.S. crude for September delivery fell 46 cents to $82.01 a barrel by 12:17 p.m EDT (1617 GMT), having traded from $81.56 to $82.48.
Front-month ICE Brent crude fell 63 cents to $81.57 a barrel.
The weak dollar helped limit crude losses after the jobless claims report. We think crude should be supported above the September contract's 200-day moving average at $81.09 and trading will probably be cautious ahead of the nonfarm payrolls report, said Richard Ilczyszyn, senior market strategist at Lind-Waldock in Chicago.
U.S. initial claims for unemployment benefits rose unexpectedly last week, underscoring a weak labor market. [ID:nN05234132], This pressured oil prices and U.S. equities. .N
Crude prices were pressured after Wednesday's U.S. Energy Information Administration report showed U.S. gasoline stockpiles rose unexpectedly last week and a bigger rise in distillate stocks than was forecast.
This added to the supply overhang despite the peak summer travel season which typically boosts demand for transport fuels like gasoline and jet fuel.
The fuel stocks rise offset a bigger-than-expected drop in stockpiles of crude oil.
U.S. RBOB gasoline futures fell 1.56 cents to $2.1594 a gallon. Heating oil futures, the U.S. benchmark distillate, dipped 1.44 cents to $2.1878 a gallon.
The market is digesting yesterday's inventory data where we're seeing a build at a time of year when inventories are normally declining. With very little of the driving season left, there is no bull market in gasoline, said Tim Evans, energy analyst at Citi Futures Perspective in New York.
The direct fundamentals for the market are bearish and today's prices are finally trying to reflect that fact, Evans added.
OPEC oil exports, excluding Angola and Ecuador, will fall by 420,000 barrels a day in the four weeks to August 21, consultancy Oil Movements said, adding support to crude prices.
Oil prices on Monday broke out of range-bound trade and moved above $80 a barrel, then pushed to a three-month high of near $83 a barrel before ending slightly lower on Wednesday.
Industry sources are watching developments in the Middle East including Israel's tensions with Lebanon and Iran's dispute with the West over Tehran's nuclear program.
While some analysts say the return of a geopolitical premium in the oil price is partly responsible for the rally, others think prices have run ahead of oil market fundamentals.
(Additional reporting by Robert Gibbons in New York, Emma Farge in London, Alejandro Barbajosa in Singapore; Editing by David Gregorio)
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