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Crude Slips, U.S. Jobs Data in Focus

Published: November 2, 2012 | 8:24 am
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Crude-oil futures edged lower in Asian trade Friday, tracking a weaker euro as concerns about Greece’s financial condition persisted and as investors await a key U.S. jobs report later in the day.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at $86.75 a barrel at 0647 GMT, down $0.34 in the Globex electronic session. December Brent crude on London’s ICE Futures exchange fell $0.13 to $108.04 a barrel.

Nymex crude had settled higher in floor trade Thursday on positive economic data from the U.S. and China and an unexpected fall in weekly oil inventories.

After superstorm Sandy, oil markets are looking to macroeconomic indicators for guidance.

“The improving data prints for both the U.S. and Chinese economies are perceived to be good tidings for the upcoming U.S. presidential elections and the Chinese leadership transition process,” Singapore-based OCBC Bank said in a note.

If the key U.S. nonfarm payrolls report expected later Friday also shows an improvement, it “should lend a risk-supportive atmosphere going into the elections,” OCBC added.

Economists in a Dow Jones Newswires survey expect the U.S. economy to have added 125,000 jobs in October, higher than 114,000 in September.

The financial situation in Europe continues to simmer, with European leaders meeting next week to decide on how to keep Greece from running out of cash and cut the country’s growing pile of debt.

Oil production from the Organization of the Petroleum Exporting Countries fell last month due to lower output from Nigeria and Iran, supporting oil prices.

OPEC output averaged 31.32 million barrels a day in October, down from 31.669 million barrels a day in September, according to a Dow Jones Newswires.

In the U.S., motorists in regions affected by superstorm Sandy face gasoline shortages as filling stations don’t have power and those that did have run dry. The infrastructure supplying oil products to the region remains affected.

“The larger problem exists at the storage terminals, where lack of power is restricting supply movement toward the tertiary or retail level of the distribution chain,” energy consulting firm Ritterbusch and Associates said in a note.

Nymex reformulated gasoline blendstock for December–the benchmark gasoline contract–fell 57 points to $2.6279 a gallon, while December heating oil traded at $3.0199, 133 points lower.

ICE gasoil for November changed hands at $939.00 a metric ton, down $3.25 from Thursday’s settlement.

Write to Eric Yep at eric.yep@dowjones.com

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