Crude Oil Ends Below $50 On Upbeat Jobs Data, Strong Dollar

(RTTNews) - U.S. crude oil ended lower on Friday, as the dollar continued to strengthen against a basket of select currencies after some upbeat economic data from the U.S. showed unemployment rate to have declined more than expected.

For the week, oil futures she about 0.3 percent.

A Labor Department report on Friday showed unemployment rate to have dropped to its lowest level in well over six years in February, with employment in the U.S. climbing much more than anticipated. The U.S. created 295,000 jobs in February with the unemployment rate dropping to 5.5 percent from 5.7 percent in January. Analysts expected about 240,000 new jobs in February.

Meanwhile, a Commerce Department report showed U.S. trade deficit to have narrowed in line with analysts' estimates in January, reflecting a notable decrease in the value of imports.

The upbeat jobs data has fueled speculation the Federal Reserve is going to raise interest rates in June. It is a move that could send the U.S. dollar to parity against the euro, denting dollar-dominated commodities in the process.

Prices withstood massive increases in U.S. crude oil inventories in recent weeks, but with little space left at storage facilities, the next move for crude prices may be back towards 6-year lows near $44 seen earlier in 2015.

Light Sweet Crude Oil futures for April delivery, the most actively traded contract, dropped $1.15 or 2.3 percent to settle at $49.61 a barrel on the New York Mercantile Exchange Friday.

Crude prices for April delivery scaled a high of $51.22 a barrel intraday and a low of $48.88.

On Thursday, crude oil fell $0.77 or 1.5 percent to settle at $50.76 a barrel, on a strong dollar with investors continuing to weigh the official weekly oil report from the Energy Information Administration that showed crude stockpiles to have jumped much more than expected last week.

The dollar continued its assault on major currencies after a strong U.S. jobs report. The dollar index, which tracks the U.S. unit against six major currencies, traded at 97.55 on Friday, up from its previous close of 96.34 on Thursday in late North American trade. The dollar scaled a high of 97.73 intraday and a low of 96.30. The dollar scaled its highest in the last one year.

The euro trended lower against the dollar at $1.0860 on Friday, as compared to its previous close of $1.1029 on Thursday in late North American trade. The euro scaled a high of $1.1035 intraday and a low of $1.0843, its lowest in the last one year.

In economic news, a Commerce Department report on Friday showed U.S. trade deficit to have narrowed in line with estimates in January, reflecting a notable decrease in the value of imports.

U.S. trade deficit narrowed to $41.8 billion in January from a revised $45.6 billion in December, which was in line with the consensus estimate.

The eurozone economy expanded as initially estimated in the fourth quarter on broad-based support from spending, investment and exports. Gross domestic product grew 0.3 percent sequentially, slightly faster than the third quarter's 0.2 percent expansion, second estimates from Eurostat showed Friday. The statistical office confirmed the estimate released on February 13.

Germany's industrial production grew for the fifth straight month in January signaling that growth is gaining a foothold in the biggest euro area economy, although orders data cast doubt over recovery.

Industrial production grew 0.6 percent in January from December, which was the fifth consecutive rise, data from Destatis showed Friday. This was also the first time since early 2011 that output rose for five straight months. The monthly rise in January was faster than a 0.5 percent rise forecast by economists, but slower than December's revised 1 percent growth.

The French trade deficit decreased unexpectedly in January, the customs office reported Friday. The trade gap widened to EUR 3.7 billion in January from EUR 3.3 billion in December and November. The deficit was forecast to narrow to EUR 3 billion.