Crude ends marginally lower

Prices continue to stay weak on overall demand concerns

Crude prices ended lower on Tuesday, 06 September, 2011 at Nymex. Prices stumbled after the weakest jobs data in nearly a year drove U.S. stocks sharply lower since last Friday. A strong dollar and global economic problems also pressured oil prices today. Prices slipped hand in hand with US equities.

Light and sweet crude for October delivery fell $0.43 (0.2%) to $86.02 a barrel on the New York Mercantile Exchange on Tuesday. Prices fell to a low of $83.2 during intra day trading. Crude gained some steam following better than expected ISM data. Last week, crude gained 1.3%. For the month of August, 2011, crude shed 7.1%.

Latest data at Wall Street showed that the U.S. services sector showed unexpected improvement in August from the month before, with the Institute for Supply Management's services index climbing to 53.3 last month from 52.7 in July. It was greater than the 51.0 that had been expected.

In the currency market on Tuesday, the dollar index, which measures the strength of the dollar against a basket of six other currencies, rose by 0.9%.

Latest data showed last Friday that the U.S. economy did not add any jobs in August. It was the weakest performance for nonfarm payroll since September 2010. According to official data from the Labor Department , no nonfarm payroll additions were made during August. That contrasted with the consensus call for an increase of 70,000. Even nonfarm private payrolls increased by a mere 17,000.

Among other energy products on Tuesday, Gasoline for October delivery declined 2 cents, or 0.6%, to $2.82 a gallon. Heating oil for the same month's delivery gained 1 cent, or 0.4%, to $3.01 a gallon.

October natural gas also bucked the trend, up 7 cents, or 1.7%, to $3.94 per million British thermal units.

At the MCX, crude oil for August delivery closed higher by Rs 81 (2.1%) at Rs 3,931/barrel. Natural gas for September delivery closed at Rs 181.2, higher by Rs 2.7 (1.5%).