SAN FRANCISCO (MarketWatch) — Crude-oil futures capped a swerving Thursday session modestly lower as an unexpectedly high level of initial jobless claims pushed worries about the U.S. economy back to the forefront.
Prices also struggled after a report showed a decline in manufacturing activity in the Philadelphia area, reviving worries about future oil-demand trends.
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Some support came mid-session from higher U.S. stocks, but the benchmarks traded lower as the session was nearing a close. Read more in Market Snapshot.
U.S. equities and oil have been tightly correlated as stocks are seen as a proxy for growth and, by extension, for oil demand.
Crude for May delivery /zigman2/quotes/209724739/delayed CLK22 -2.46% declined 40 cents, or 0.4%, to settle at $102.27 a barrel on the New York Mercantile Exchange, down for two sessions in a row and at its lowest since April 10.
“There’s still some hope for oil demand, but not enough to spur any buying,” said Matt Smith, analyst with Summit Energy in Kentucky.
Meanwhile, natural-gas futures settled at their lowest since Sept. 2001, struggling to hold to $1.90 per million British thermal units.
The jobless-claims numbers took the wind out of energy markets’ sails and, in the absence of major geopolitical concerns, prices drifted, he added.
The number of applicants filing for unemployment hovered near a four-month high, with weekly claims at 386,000 in the week ended April 14, the Labor Department reported. Economists polled by MarketWatch had projected claims would fall to 374,000. Read more about jobless data.
The index gauging manufacturing activity in the Philadelphia region rose at a slower pace in April, falling to 8.5 from 12.5 in March. Sales of existing U.S. homes fell 2.6% in March, more than expected.
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Oil prices on Wednesday fell $1.53, or 1.5% after a U.S. government inventories report that showed a higher-than-expected rise in crude supplies.
Meanwhile, May natural gas fell 4 cents, or 2.3%, to end at $1.907 per million British thermal units. That was the product’s lowest settlement since late September, 2001, and off 88% from a record $15.38 per million Btu hit in December 2005.
Year to date, natural-gas futures have lost 36%.
The Energy Information Administration reported an increase of 25 billion cubic feet to supplies of natural gas in the week ended April 13.
Analysts surveyed by Platts had expected a rise between 24 billion and 28 billion cubic feet for the week.
Natural gas has fallen into a pattern of strength ahead of the supplies data but selling after the report, often regardless of its content. Prices have suffered from warmer-than-usual weather trends and high production.
Rounding out Thursday’s energy trading, gasoline for May delivery /zigman2/quotes/210287262/delayed RBK22 0.00% declined 5 cents, or 1.5%, to $3.15 a gallon, while May heating oil /zigman2/quotes/210063568/delayed HOK22 -1.14% rose 1 cent to $3.125 a gallon.