USD 92.5919

+0.02

EUR 100.2704

-0.14

Brent 85.88

+0.19

Natural gas 1.694

-0.02

605

Oil Trims Losses to Trade Near Two-Year High on Economic Recovery Optimism

Oil traded near the highest close in two years on speculation that U.S. fuel demand will increase as the economic recovery gathers pace in the world’s biggest oil consumer

Oil Trims Losses to Trade Near Two-Year High on Economic Recovery Optimism

Oil was little changed, trimming earlier losses, before a Labor Department report that may show the U.S. hired more workers for a second month. Crude has climbed 4.8 percent this week after government data indicated U.S. home sales increased and manufacturing expanded. Prices settled yesterday at $88 a barrel, the highest in more than two years.

“The market is going to be focused on what happens tonight with the unemployment number,” said Jonathan Barratt, managing director of Commodity Broking Services Pty in Sydney. “Oil is now at the top end of the range.”

The January contract was at $87.83 a barrel, down 17 cents, or 0.2 percent, in electronic trading on the New York Mercantile Exchange at 11:48 a.m. Singapore time. It earlier dropped as much as 0.5 percent.

U.S. employers added 150,000 workers last month, a Bloomberg survey showed before the Labor Department report today. Data yesterday showed pending sales of U.S. existing houses unexpectedly jumped by a record 10 percent in October, while claims for jobless benefits over the past month on average dropped to a two-year low.

Brent Backwardation

Crude also gained yesterday after the dollar dropped against the euro, making the commodity more attractive to investors. The U.S. currency was at $1.3199 today, up 0.1 percent.

Brent crude oil for January settlement was at $90.63 a barrel, down 6 cents, on the London-based ICE Futures Europe exchange. The contract increased $1.82, or 2 percent, to end the session yesterday at $90.69, the highest close since Oct. 1, 2008.

Brent for January is trading at a 3-cent premium to the February future, a market situation known as backwardation that suggest prompt supplies are more in demand than later deliveries.


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