Crude prices register huge drop

Prices settle at its lowest levels in almost three months following disappointing job data Crude prices ended substantially lower on Friday, 04 May 2012 at Nymex. Prices dropped following a disappointing job report from the Labor Department. A strong dollar also pushed down prices and the same settled at its lowest levels in almost three months. Light and sweet crude for June delivery fell $4.05 (4%) to $98.49 a barrel on the New York Mercantile Exchange on Friday. For the week, crude lost 6.1%. In the currency market on Friday, the Dollar Index, which weighs the strength of dollar against basket of six other currencies rose by almost 0.3%. The dollar was weaker earlier during the day. The Labor Department in US reported on Friday that the U.S. economy added 115,000 jobs in April as hiring slacked off for the second straight month. Market had expected a 163,000 increase. The unemployment rate, meanwhile, dipped to 8.1% from 8.2%, as nearly 350,000 people dropped out of the labor force. The report also showed that average workweek was unchanged at 34.5 hours, while average hourly earnings rose 1 cent to $23.38. The increase in employment in March was revised up to 154,000 from an initial reading of 120,000. The gain in February was revised up to 259,000 from 240,000. In the latest weekly inventory report, the Energy Information Administration reported during the week a rise in crude supplies by 2.8 million barrels, in line with expectations but an increase that brought U.S. inventories to nearly 376 million barrels of oil, their highest level since September 1990. It was also the sixth reported increase in weekly supplies. Market had expected a rise of 2.5 million barrels. The EIA also reported a decline in gasoline inventories by 2 million barrels, and a decline in distillates supplies by 1.9 million barrels. Market had expected gasoline stockpiles down 1 million barrels and distillates supplies down 400,000 barrels. Among other traded energy products on Friday, gasoline for June delivery fell 7 cents, or 2.4%, to $2.98 a gallon, extending gasoline's losing streak to a fifth session. The settlement put weekly losses for gasoline at 5.4%. June heating-oil futures dropped 8 cents, or 2.5%, to $3 a gallon. It put weekly losses at 5.5%. June natural-gas futures shed 6 cents, or 2.6%, to $2.28 per million British thermal units. For the week, however, the product gained 4.3%, up for two consecutive weeks.