Crude Oil Ends Lower As Dollar Strengthens; Shed 5.8% For Month

(RTTNews) - U.S. crude oil settled lower on Thursday, after some strong macroeconomic data fueled concerns that the Federal Reserve may begin tapering its quantitative easing program much earlier than expected. Oil prices were also under pressure with the dollar trading higher against a few major currencies, coupled with the increased supply scenario after an Energy Information Administration report yesterday showed crude oil stockpiles to have risen more than expected last week.

For the month, oil futures dropped 5.8 percent.

Light Sweet Crude Oil futures for December delivery, the most actively traded contract, dropped $0.39 or 0.4 percent to close at $96.38 a barrel on the New York Mercantile Exchange Thursday.

Crude prices for December delivery scaled a high of $97.82 a barrel intraday and a low of $96.59.

Yesterday, oil plunged to end at a four-month low after the Energy Information Administration weekly oil report showed U.S. crude stockpiles to have jumped more than expected last week.

The EIA weekly oil report showed U.S. crude oil inventories to have surged 4.10 million barrels for the week ended October 25. Analysts expected crude oil inventories to gain 3.5 million barrels for the week.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.15 on Thursday, up from 79.75 late Wednesday in North American trade. The dollar scaled a high of 80.22 intraday and a low of 79.68.

The euro traded lower against the dollar at $1.3595 on Thursday, as compared to its previous close of $1.3736 late Wednesday in North America. The euro scaled a high of $1.3738 intraday and a low of $1.3588.

In economic news from the U.S., the Labor Department said initial jobless claims dipped to 340,000, a decrease of 10,000 from the previous week's unrevised figure of 350,000. Economists had expected jobless claims to fall to 335,000.

Chicago-area business activity unexpectedly grew at a substantially accelerated rate in October, a report from MNI Indicators showed Thursday. The Chicago Business Barometer jumped to 65.9 in October from 55.7 in September, with a reading above 50 indicating growth in business activity. Economists expected the index to edge down to 55.0. The index rose for the fourth straight month and is at its highest level since March 2011.

Eurozone inflation reached a four-year low in October driven by the strength of the euro, while the unemployment rate remained at a record high in September, suggesting additional measures are needed to preserve the recovery, official data showed Thursday. Eurozone inflation dropped to 0.7 percent in October, the lowest rate since November 2009, flash estimate published by Eurostat showed. The rate was expected to stay unchanged at 1.1 percent in October.

Elsewhere, Germany's forward-looking consumer confidence index declined unexpectedly heading into November, a survey by market research group GfK revealed. The confidence index edged down to 7 in November from 7.1 in October. Economists expected an increase to 7.2.

Germany's retail sales unexpectedly declined for a second straight month in September, data released by Destatis showed on. Retail sales dropped a calendar-and-seasonally-adjusted 0.4 percent month-on-month, while economists' consensus was a 0.4 percent gain. In August, sales fell 0.2 percent.

Meanwhile, eurozone inflation slowed unexpectedly in October largely due to a notable fall in energy prices, official data showed. Inflation fell to 0.7 percent in October from 1.1 percent in September, flash estimate published by Eurostat revealed. The rate was expected to stay unchanged at 1.1 percent in October.