Crude Oil Ends Higher After U.S. Data, Inventories

(RTTNews) - U.S. crude oil snapped a three-day loss to end higher Thursday, on some upbeat U.S. data and a weekly oil report from the U.S. Energy Information Administration that showed gasoline inventories to have dropped more than expected last week, notwithstanding a surge in crude oil inventories.

A weak dollar, combined with some mixed economic data out of the U.S. and bargain hunting also helped oil prices move higher, after having touched a low of $79.78 a barrel earlier in the day.

Investors weighed some largely upbeat U.S. economic data, with reports showing an unexpected drop in initial jobless claims and a bigger than expected increase in industrial production.

Earlier today, a weekly report from the U.S. Energy Information Administration showed U.S. crude oil inventories to have risen by 8.9 million barrels in the week ended October 10, while analysts anticipated an increase of 2.8 million barrels. The EIA report showed U.S. crude oil inventories at 370.6 million barrels, end last week.

Gasoline stocks dropped by 4.0 million barrels last week, with analysts anticipating a decrease of 1.4 million barrels. Inventories of distillate, including heating fuel, dropped 1.5 million barrels last week. Analysts anticipated a decline of 1.7 million barrels.

A report from the American Petroleum Institute late Wednesday showed U.S. crude inventories to have risen by 10.2 million barrels in the week ended October 10, compared to an expectation of a 2.5 million barrels rise.

Light Sweet Crude Oil futures for November delivery, the most actively traded contract, gained $0.92 or 1.1 percent to close at $82.70 a barrel on the New York Mercantile Exchange Thursday.

Crude prices for November delivery scaled a high of $84.83 a barrel intraday and a low of $79.78.

On Wednesday, crude oil futures ended a tad lower impacted by some disappointing economic data from the U.S. amid rising concerns over the health of the global economy after a flood of gloomy economic forecast.

During the week, crude prices were pushed to a near $80 a barrel amid mounting concerns over global demand growth outlook, with the International Energy Agency projecting a modest rise in global demand in 2015. Saudi Arabia was also reported to allow prices fall in order to lessen the appeal of alternative fuels and weaken non-OPEC competition.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 84.84 on Thursday, down from its previous close of 84.86 late Wednesday in North American trade. The dollar scaled a high of 85.43 intraday and a low of 84.74.

The euro trended lower against the dollar at $1.2816 on Thursday, as compared to its previous close of $1.2837 late Wednesday in North American trade. The euro scaled a high of $1.2845 intraday and a low of $1.2706.

On the economic front, a Federal Reserve report on Thursday showed industrial production in the U.S. rebounded much more than expected in September, after an unexpected drop in production in the previous month.

The Federal Reserve said industrial production in the U.S. surged by 1.0 percent in September after edging down by a revised 0.2 percent in August. Economists expected production to increase by about 0.4 percent compared to the 0.1 percent drop originally reported for the previous month.

First-time claims for U.S. unemployment benefits unexpectedly declined in the week ended October 10, a report from the Labor Department showed Thursday, with initial jobless claims falling to their lowest level in over fourteen years. Initial jobless claims fell to 264,000, a decrease of 23,000 from the previous week's unrevised level of 287,000. Economists expected jobless claims to edge up to 290,000 last week.

With the unexpected decrease, jobless claims fell to their lowest level since hitting 259,000 in the week ended April 15, 2000.

A report from the National Association of Home Builders showed homebuilder confidence in the U.S. to have deteriorated notably in October, with the NAHB/Wells Fargo Housing Market Index dropping to 54 in October after jumping to a nearly nine-year high of 59 in September. Economists expected the index to come in unchanged compared to the previous month.

A report from the Federal Reserve Bank of Philadelphia showed manufacturing activity in the Philadelphia area grew at a slower rate in the month of October. The Philly Fed's diffusion index for current activity edged down to 20.7 in October from 22.5 in September. Economists expected the index to dip to a reading of 20.0.

Elsewhere, data from Eurostat showed eurozone inflation to have declined to 0.3 percent in September, the lowest since late 2009, raising fears of deflation.