Crude Oil Ends Slightly Higher

(RTTNews) - After fluctuating for most of the day, U.S. crude oil ended slightly higher for a second straight session on Thursday, on some positive first-time claims for unemployment benefits data and the official weekly oil report from the Energy Information Administration on Wednesday which showed crude stockpiles in the U.S. to have declined unexpectedly.

Analysts say the dramatic recent plunge in oil prices may have been overdone, prompting bargain hunters to step in. Oil prices have dropped more than 50 percent from last summer highs above $101.

Yesterday, minutes of the latest Federal Reserve meeting showed that policy makers expect the big drop in oil prices will probably end up boosting U.S. growth.

Investors also weighed data from the U.S. Labor Department that showed first-time claims for unemployment benefits to have decreased modestly last week, with the lowest layoffs in over 17 years.

Light Sweet Crude Oil futures for February delivery, the most actively traded contract, added $0.14 or 0.3 percent to close at $48.79 a barrel on the New York Mercantile Exchange Thursday.

Crude prices for February delivery scaled a high of $49.65 a barrel intraday and a low of $47.73.

On Wednesday, crude oil ended higher after an official weekly oil report from the Energy Information Administration showed crude stockpiles in the U.S. to have declined more than expected last week, even as gasoline inventories jumped much more than anticipated.

The official report showed U.S. crude oil inventories to have declined 3.1 million barrels in the week ended January 2, while analysts expected an increase of 0.9 million barrels.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 92.37 on Thursday, up from its previous close of 92.02 late Wednesday in North American trade. The dollar scaled a high of 92.53 intraday and a low of 91.94.

The euro trended lower against the dollar at $1.1785 on Thursday, as compared to its previous close of $1.1839 late Wednesday in North American trade. The euro scaled a high of $1.1849 intraday and a low of $1.1756.

In economic news from the U.S., first-time claims for unemployment benefits saw a modest decrease in the week ended January 3, a report from the Labor Department showed Thursday. The report said initial jobless claims edged down to 294,000, a decrease of 4,000 from the previous week's unrevised level of 298,000. Economists had expected jobless claims to dip to 290,000.

The U.S. Labor Department is scheduled to release its closely watched monthly employment report for December on Friday. Economists expect employment to increase by about 245,000 jobs in December after jumping by 321,000 jobs in November. The unemployment rate is expected to dip to 5.7 percent from 5.8 percent, hitting its lowest level since June of 2008.

Eurozone retail sales grew more-than-expected in November, at the same rate as in the previous month, preliminary data from Eurostat showed Thursday. Retail sales rose 0.6 percent from October, when they grew the same, revised from 0.4 percent. Economists had expected a modest gain of 0.2 percent.

Eurozone producer prices decreased more than expected in November on a sharp fall in energy prices, data from Eurostat revealed Thursday. Producer prices dropped 1.6 percent year-on-year in November, faster than the 1.3 percent decrease in October. Economists had forecast prices to decline 1.4 percent.

Eurozone economic confidence remained stable in December, with the sentiment index at 100.7, the same score as seen in October and November. It was expected to rise to 101.2. The economic confidence remained stable at the end of the year as the strength in consumer, retail and services confidence outweighed worsening industrial sentiment, a monthly survey by the European Commission showed Thursday.

Elsewhere in Europe, the Bank of England kept its key interest rate at a record low once again at the start of the year amid growing concerns about inflation falling below 1 percent in months ahead. The Monetary Policy Committee held the key bank rate at 0.50 percent and the asset purchases at GBP 375 billion.

German factory orders declined more-than-expected in November on a sharp contraction in domestic demand signaling weak economic activity in the largest euro area economy. Factory orders declined 2.4 percent month-on-month, reversing a revised 2.9 percent rise in October, Destatis said Thursday. Orders were expected to fall by 0.8 percent. This was the first drop in demand in three months.