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Oil Prices Slump On US Payrolls Data


World oil prices nosedived on Friday, hitting three-month lows as a disappointing US non-farm payrolls report sparked fresh concern over energy demand in the world’s biggest crude consuming nation. Brent North Sea crude for delivery in June tumbled as low as $111.76 per barrel in afternoon trade, hitting the lowest point since February 2. And New York’s main contract, light sweet crude or West Texas Intermediate (WTI), sank to $97.83 a barrel, striking a point last seen on February 10. “Crude oil prices have dropped sharply today as fears of a global economic slowdown increased,” said CMC Markets analyst Michael Hewson.


Disappointing US job creation numbers also sent Wall Street stocks falling in early trade Friday, confirming that the US economy has hit a weak patch in the past month. The net number of jobs created in April in the world’s largest economy, at 115,000, was well below the already modest expectations of forecasters, and was underpinned by a fall in the labor market participation rate — all a signal that households are still not doing well. “The sharp falls in stock markets on Friday in the wake of the reported 115,000-increase in US non-farm payrolls in April suggests fears are growing that the recovery is fading fast, just like it did at this time last year,” said Capital Economics analyst Paul Ashworth.


The numbers were offset somewhat by an improvement in the overall US unemployment rate, which fell a tick to 8.1 percent, the best since January 2009. In later afternoon deals on Friday, Brent oil stood at $112.27, down $3.81 from Thursday’s closing level, while WTI traded at $98.25, down a hefty $4.29. World oil markets witnessed rollercoaster trade this week as investors tracked the global economic outlook.

Source: AFP