Crude Oil Ends Below $108 As Syria Tensions Ease

(RTTNews) - U.S. crude oil snapped a two-day gain to end lower Thursday, after supply concerns over a possible military intervention against Syria eased with both the U.S. and U.K. backing down from any immediate action. Earlier today, the U.N. Security Council's permanent members failed to agree to a proposal for any military action against the civil war ravaged Syria.

Oil prices recorded a 4-percent gain in the last two days with fears of supply disruption over the tense situation in Syria on a possible military intervention by the U.S. and its allies.

Light Sweet Crude Oil futures for October delivery, the most actively traded contract, declined $1.30 or 1.2 percent to close at $108.80 a barrel on the New York Mercantile Exchange Thursday.

Crude prices for October delivery scaled a high of $110.07 a barrel intraday and a low of $108.60.

Yesterday, oil gained 1 percent to settle near a 16-month high, heavily influenced by the tense situation in Syria with the U.S. and its allies mulling over possibilities of military intervention, which could have sparked-off trouble throughout the Middle East and disrupt oil supplies from the region.

An Energy Information Administration report on Wednesday showed U.S. crude oil inventories to have increased 3.00 million barrels, while gasoline stocks shed 0.60 million barrels in the week ended August 23. Analysts expected crude oil inventories to decline by 0.30 million barrels last week.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 81.97 on Thursday, up from 81.44 late Wednesday in North American trade. The dollar scaled a high of 82.07 intraday and a low of 81.38.

The euro traded lower against the dollar at $1.3239 on Thursday, as compared to $1.3339 late Wednesday in North America. The euro scaled a high of $1.3343 intraday and a low of $1.3220.

In economic news from the U.S., the Labor Department said initial jobless claims edged down to 331,000, a decrease of 6,000 from the previous week's revised figure of 337,000. The modest drop came roughly in line with the expectations of economists, who expected jobless claims to dip to 330,000 from the 336,000 originally reported for the previous week.

Separately, the Commerce Department said GDP increased by 2.5 percent in the second quarter, reflecting an upward revision from the advance estimate of 1.7 percent growth. Economists had been anticipating a somewhat more modest upward revision to the pace of GDP growth to about 2.2 percent

From the eurozone, Germany's unemployment increased by 7,000 in August from the previous month, the Federal Labor Agency reportedly said. Economists had forecast unemployment to fall by 5,000. The jobless rate remained unchanged at seasonally adjusted 6.8 percent. The rate came in line with economists' expectations.

According to the figures released by Destatis, the number of unemployed decreased by 40,000 in July from the prior month to 2.28 million. At the same time, the jobless rate dropped slightly to adjusted 5.3 percent from 5.4 percent in June.