Crude Oil Plunges To End Below $44, Sheds 6.9% For Week

(RTTNews) - U.S. crude oil dropped to end at a more than four-month low on Friday, amid supply glut fears with global supplies rising as the Organization of the Petroleum Exporting Countries continue to pump oil at a record pace to scuttle competition from U.S. producers.

Crude oil futures tumbled about 6.9 percent for the week. This is the biggest decline since March.

Oil was also under pressure after oil services firm, Baker Hughes Inc. in its weekly rig count on Friday said U.S. oil rigs actively drilling for oil rose by 6 units to 670 rigs from a previous count of 664. This is the third consecutive week of increase.

Meanwhile, job growth in the U.S. slowed for the second consecutive month in July, a report from the Labor Department said Friday, although it still indicates a notable increase in employment. The unemployment rate remained unchanged at 5.3 percent.

Although a bit soft, analysts believe the data would not bring about any possible change in the Fed stand in hiking interest rates soon, which could be in September.

Light Sweet Crude Oil futures for September delivery, the most actively traded contract, plunged $0.79 or 1.8 percent, to settle at $43.87 a barrel on the New York Mercantile Exchange Friday.

Crude prices for September delivery scaled a high of $45.16 a barrel intraday and a low of $43.83.

On Thursday, crude oil futures for September delivery dropped $0.49 or 1.1 percent, to settle at $44.66 a barrel, amid worries of a global supply glut, notwithstanding a sharp, more than expected decline in U.S. crude stockpiles last week.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 97.55 on Friday, down from its previous close of 97.79 in late North American trade on Thursday. The dollar scaled a high of 98.33 intraday and a low of 97.51.

The euro trended higher against the dollar at $1.0973 on Friday, as compared to its previous close of $1.0926 in North American trade late Thursday. The euro scaled a high of $1.0980 intraday and a low of $1.0858.

In economic news, job growth in the U.S. slowed for the second consecutive month in July, a report from the Labor Department said Friday, with non-farm payroll employment rising by 215,000 jobs in July following an upwardly revised increase of 231,000 jobs in June and a jump of 260,000 jobs in May. Economists expected employment to climb by about 223,000 jobs.

The report also said the unemployment rate held at 5.3 percent in July, unchanged from the seven-year low set in June. This is in line with economist estimates.

German exports decreased for the first time in five months in June and imports fell unexpectedly, preliminary figures from Destatis showed Friday. Exports dropped 1.0 percent month-on-month in June, reversing a 1.6 percent climb in the previous month. Economists had expected a 0.3 percent fall for the month.

Imports also slid 0.5 percent monthly in June, confounding economists' expectations for a 0.5 percent gain. In May, imports had risen 0.7 percent. The seasonally and calendar-adjusted trade surplus came in at EUR 22.0 billion in June.

Germany's industrial production logged an unexpected decline in June, provisional data from Destatis revealed Friday. Industrial production dropped 1.4 percent month-on-month in June, which was the biggest fall since August, when it declined 2.8 percent. It was expected to rise 0.3 percent. In May, production grew by revised 0.2 percent.

The U.K. visible trade deficit widened in June, data from the Office for National Statistics showed Friday. The visible trade deficit increased to GBP 9.2 billion in June from GBP 8.4 billion in May. But it was smaller than the expected shortfall of GBP 9.3 billion.

French industrial output declined unexpectedly in June after rising in the previous month, the statistical office Insee reported Friday. Industrial production declined 0.1 percent month-on-month in June, in contrast to a 0.4 percent rise in May. Economists had expected a 0.2 percent increase for the month. In April, output had fallen 1.0 percent.

France's trade deficit sharply narrowed in June to reach its lowest level in more than eight years as exports grew robustly on the back of several large contracts, data from French Customs showed Friday. The trade deficit declined to EUR 2.658 billion from EUR 3.999 billion in May. The latest trade gap was the smallest since March 2007, when the shortfall was EUR 2.533 billion. A year ago, the trade deficit was EUR 5.529 billion.