BUSINESS

Oil rises above US$95 after good jobs signal a day ahead of unemployment report

06/06/2013 11:50 EDT | Updated 08/06/2013 05:12 EDT
NEW YORK, N.Y. - Oil rose to a high for the week Thursday after a positive reading on the U.S. job market, as natural gas plunged on a surprisingly large increase in the nation's supplies.

U.S. benchmark oil for July delivery gained US$1.02 to finish at $94.76 a barrel in New York, the highest close since May 28. Earlier in the session, crude hit $95.32 a barrel.

Natural gas dropped 17 cents, or 4.1 per cent, to end at $3.83 per 1,000 cubic feet.

Oil prices received support from the latest government unemployment update. The U.S. Labor Department said Thursday that the number of Americans seeking unemployment benefits fell 11,000 last week to a seasonally adjusted 346,000, a level consistent with steady job growth. The claims figures come a day ahead of the monthly payrolls report, which often sets the tone across financial markets for a week or two after its release.

Natural gas sank after the government released weekly supply numbers. Natural gas supplies tend to rise at this time of year, between the heating and air conditioning seasons. The report showed supplies rose by 111 billion cubic feet to 2.252 trillion cubic feet for the week ended May 31. That was well above the average increase for the last week of May of 82 billion cubic feet to 98 billion, according to the daily newsletter The Schork Report.

Natural gas futures have dropped 43 cents, or 10 per cent in the last two weeks.

Brent crude, a benchmark for many international oil varieties, rose 57 cents to finish at $103.61 a barrel on the ICE Futures exchange in London.

In other energy futures trading on the New York Mercantile Exchange:

— Wholesale gasoline rose three cents to end at $2.85 a gallon.

— Heating oil added two cents to finish at $2.87 per gallon.

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Pablo Gorondi in Budapest, Pamela Sampson in Bangkok and Christopher S. Rugaber in Washington contributed to this report.

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