Crude Oil Plummets To End Below $99

(RTTNews) - U.S. crude oil plunged to end lower for a fourth straight session Thursday, on demand growth concerns after some dismal economic data from the U.S. with initial claims for unemployment benefits rising and slower growth in manufacturing activity in the Chicago area.

Investors also continued to mull over data that showed a glut in U.S. supplies, with the official weekly oil report from the Energy Information Administration indicating U.S. crude stockpiles to have declined more than expected last week, with gasoline and distillates supplies rising.

Analysts say refineries are planning to scale back production at the end of summer, denting demand for crude oil.

Crude prices were impacted after some disappointing economic data from the U.S. with first-time claims for U.S. unemployment benefits rebounding in the week ended July 26, with initial jobless claims bouncing off the fourteen-year low seen in the previous week.

Meanwhile, a report from MNI Indicators on Thursday showed Chicago-area business activity grew at a substantially slower rate than expected in July, with the business barometer falling to its lowest level in a year.

Light Sweet Crude Oil futures for September delivery, the most actively traded contract, plunged $2.10 or 2.1 percent to close at $98.17 a barrel on the New York Mercantile Exchange Thursday.

Crude prices for September delivery scaled a high of $99.85 a barrel intraday and a low of $97.95.

On Tuesday, crude oil futures ended lower after the weekly oil report from the U.S. Energy Information Administration, with lingering concerns over the ongoing unrest in Ukraine and the Middle East, and the fresh sanctions on Russia.

U.S. oil stockpiles fell by 3.7 million barrels in the week ended July 25, compared with market expectations for a 1.8 million-barrel decline, the Energy Information Administration said Wednesday. Gasoline stocks rose by 0.4 million barrels last week, while inventories of distillate, including heating fuel, rose 0.8 million Analysts anticipated an increase of 1.3 million barrels and 1.4 million barrels, respectively.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 81.45 on Thursday, up from its previous close of 81.40 late Tuesday in North American trade. The dollar scaled a high of 81.57 intraday and a low of 80.38.

The euro traded lower against the dollar at $1.3389 on Thursday, as compared to its previous close of $1.3401 late Wednesday in North American trade. The euro scaled a high of $1.3401 intraday and a low of $1.3372.

In economic news from the U.S., a report from the Labor Department said first-time claims for U.S. unemployment benefits climbed to 302,000, an increase of 23,000 from the previous week's revised level of 279,000. Economists expected jobless claims to rise to 301,000 from the 284,000 originally reported for the previous week.

Meanwhile, MNI Indicators said the Chicago business barometer tumbled to a reading of 52.6 in July after dipping to 62.6 in June. While a reading above 50 indicates continued growth in Chicago-area business activity, economists had expected the index to inch back up to 63.0.

Eurozone inflation slowed to the lowest level in four-and-a-half years in July, even after the European Central Bank cut the interest rates to historic lows, necessitating more action to elude the risk of deflation. Euro area inflation slowed to 0.4 percent in July from 0.5 percent in June, flash estimate from Eurostat revealed today. The figure was expected to remain unchanged at 0.5 percent.

The unemployment rate in the 18-nation bloc declined unexpectedly in June to the lowest since September 2012 from a record high seen at the end of last year as labor market conditions improved notably in Germany and Spain. Meanwhile, the signs of improvement in Italy was dampened by the youth joblessness hitting a record.