U.S. crude oil futures closed at a seven-week low Monday, on demand concerns following some soft U.S. jobs data last week and a disappointing consumer price inflation report from China for March. The upcoming international talks with Iran over its nuclear program also had an impact on oil prices.
Consumer price inflation in China accelerated more than expected in March, which dampened expectations that the country would introduce fresh monetary easing measures in the near-term. Lingering doubts continued to persist over the U.S. economic recovery after a Labor Department report showed continued employment growth in the country for March, but well below what economists expected.
Light Sweet Crude Oil futures for May delivery, dropped $0.85 or 0.8 percent to close at $102.46 a barrel on the New York Mercantile Exchange Monday.
Crude prices scaled a high of $102.60 a barrel intraday and a low of $100.81.
Last week oil moved higher despite continued worries over demand growth even as the dollar pushed ahead following the release of Federal Reserve policy meeting minutes.
The dollar index, which tracks the U.S. unit against six major currencies, pared gains to trade lower at 79.826 on Monday, from 79.840 in North American trade late Friday. The dollar scaled a high of 80.10 intraday, with a low of 79.76.
The euro was trading higher against the dollar at $ 1.3103 on Monday, as compared to $1.3092 late Friday. The euro had scaled a high of $1.3117 intraday with a low of $1.3034.
U.S. employment saw continued growth in March, according to a Labor Department report Friday, although well below economists expectations. Non-farm payroll employment increased by 120,000 in March, following an upwardly revised increase of 240,000 jobs in February. Economists expected the addition of about 201,000 jobs compared to the increase of 227,000 jobs reported for the previous month.
Consumer price inflation in China accelerated by 3.6 percent in March, up from 3.2 percent in February. Analysts expected consumer price inflation to increase 3.3 percent.
During the week, traders focus will be the Beige Book, the jobless claims report and the Reuters and University of Michigan's preliminary consumer sentiment reading, the Commerce Department's trade balance report for February, the Labor Department's consumer and producer price inflation reports for March.
Also, in focus will be the crude oil inventories data from the API, due Tuesday and the EIA report due Wednesday.
by RTT Staff Writer
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