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Crude Oil Plunges To End Below $96

Crude Oil Plunges To End Below $96

U.S. crude oil ended sharply lower Friday, as the dollar strengthened against a basket of major currencies even as investors reassessed the demand growth for oil. Traders remained cautious ahead of the G20 meet in Moscow awaiting more cues on currencies, while largely ignoring some upbeat macroeconomic data out of the U.S.

Light Sweet Crude Oil futures for March delivery, the most actively traded contract, shed $1.45 or 1.5 percent, to close at $95.86 a barrel on the New York Mercantile Exchange Friday.

Crude prices for March delivery scaled a high of $97.47 a barrel intraday and a low of $95.21.

For the week, oil gained near 0.2 percent.

Yesterday, oil settled higher on some upbeat jobs claims data and supply concerns due to geopolitical tensions in the Middle East. A strong dollar also checked the progress made by oil intraday. Investors also digested the soft eurozone GDP data which showed the economy to have contracted the most since the first quarter of 2009.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.50 on Friday, up from 80.39 late Thursday in North American trade. The dollar scaled a high of 80.60 intraday and a low of 80.22.

The euro traded lower against the dollar at $1.3357 on Friday, as compared to $1.3362 late Thursday in North America. The euro scaled a high of $1.3391 intraday and a low of $1.3308.

In economic news from the U.S., the Federal Reserve Bank of New York said its general business conditions index jumped to a positive 10.0 in February from a negative 7.8 in January, with a positive reading indicating an increase in regional manufacturing activity. Economists expected the index to climb to a negative 1.8.

Consumer sentiment in the U.S. improved more than anticipated in February, a report from Thomson Reuters and the University of Michigan said Friday. The preliminary reading on the consumer sentiment index came in at 76.3 in February compared to January's final reading of 73.8. Economists expected the index at a reading of 75.0.

The bigger than expected increase by the headline index was partly due to an improvement in consumers' assessment of the current situation, with the reading on current economic conditions rising to 88.0 in February from 85.0 in January. The expectations index also rose to 68.7 in February from 66.6 in January, reflecting an improvement in consumers' assessment of the economic outlook.

With decreases in manufacturing and mining output more than offsetting a substantial rebound by utilities output, a Federal Reserve report on Friday showed U.S. industrial production to have unexpectedly decreased in January. Industrial production edged down by 0.1 percent in January following a revised 0.4 percent increase in December. Economists expected production to increase by 0.3 percent, matching the growth originally reported for the previous month.

Elsewhere, eurozone's trade surplus declined in December from a month earlier, the latest figures published by Eurostat revealed. The surplus fell to EUR 11.7 billion in December from a revised EUR 13 billion in the previous month. Economists expected the surplus to fall to EUR 13.1 billion from November's originally estimated EUR 13.7 billion.

U.K. retail sales including auto fuel fell unexpectedly by 0.6 percent in January from the prior month, the Office for National Statistics said. Economists had forecast a 0.5 percent rise, following a 0.3 percent drop in December.

by RTT Staff Writer

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