Oil prices slide on profit-taking

8th July 2011, Comments 0 comments

World oil prices sank on Friday as traders took profits from a major rally, and awaited crucial economic data in top global crude consumer the United States.

New York's main contract, West Texas Intermediate for delivery in August, fell 41 cents to $98.26 a barrel, after surging by $2.02 on Thursday.

Brent North Sea oil for August reversed by $1.13 to $117.46 in London morning deals, one day after rocketing by $4.97.

Traders will focus later on Friday on the publication of the non-farm payrolls report at 1230 GMT.

"Today, much will depend on June's NFP numbers from the United States," said analyst Andrey Kryuchenkov at VTB Capital.

Crude futures had surged Thursday on the back of positive US economic data and signs of improving demand.

Payrolls firm ADP said that private businesses added 157,000 jobs in June, a solid jump after the weak 36,000 job increase in May.

The ADP figures raised expectations for Friday's much-awaited US non-farm payrolls (NFP) data for June.

"The market gained ground alongside firmer equity and commodity markets following a much better than expected ADP national employment survey for the US private sector," added Kryuchenkov.

"Risk sentiment was upbeat yesterday with market participants still betting on the upside in oil."

The market had also drew support on Thursday from the latest snapshot of US oil inventories.

The US government's Department of Energy announced that gasoline or petrol reserves fell 600,000 barrels in the week ending July 1.

That confounded expectations for a gain of 200,000 barrels, according to analysts polled by Dow Jones Newswires, and indicated stronger demand as prices fell and summer vacations began.

Crude inventories, however, were down 900,000 barrels last week, well short of forecasts for a 2.4-million-barrel drop.


© 2011 AFP

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