Friday, June 4, 2010

Disappointing Employment Numbers Drag Crude Oil Down Near $72

Crude oil prices fell hard Friday after a key barometer of the economy showed that U.S. companies remain reluctant to hire, dampening prospects that a rebounding economy mean more oil and gasoline demand. The nation's payrolls added 431,000 jobs last month, almost all of them from temporary census jobs. The unemployment rate inched down to 9.7 percent. Private companies added just 41,000 jobs, compared with 218,000 in April, and well below analysts' forecasts.

Stock markets dropped with the weaker than expected private sector hiring picture, and that pulled down oil prices as well. The Dow Jones Industrial Average, the NASDAQ and the S&P 500 were all down about 2 percent in late morning trading. Meanwhile, retail gasoline prices rose Friday for the first time in nearly a month, though analysts think pump prices for June are likely to continue falling, albeit at a slower pace.

Benchmark crude for July delivery dropped $2.38 at $72.23 per barrel in trading on the New York Mercantile Exchange. Earlier in the session, it climbed as high as $75.42. The contract rose $1.75 to settle at $74.61 on Thursday. "This jobs report makes it look like we're not going to see a summer boom," said Mike Lynch of Strategic Energy and Economic Research.....Read the entire article.

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