Crude Oil Surges To Close Well Above $110

(RTTNews) - U.S. crude oil moved sharply higher to end well above $110 a barrel on Friday, scaling its highest level in more than two years, as investors took stock of some disappointing, lesser than expected jobs data out of the U.S. which eased concerns of any immediate tapering of the Federal Reserve's bond-buying program. Oil also found additional support with the dollar trending lower against a basket of some select currencies and the euro.

Oil futures gained 2.7% for the week.

Meanwhile, concerns over supply disruption from the Middle East increased as the Syrian crisis continued to get murkier, with U.S. President Barack Obama pitching hard for military action against the civil war ravaged Syria at the concluding day of the G20 summit. President Obama's plea for immediate military strike on Syria was staunchly opposed by Russian President Vladimir Putin, with countries like China, Argentina, South Africa, and India also opposing the option.

In some disappointing economic news, a report from the U.S. Labor Department on Friday showed employment in the country rose less than expected in August, with job growth in the retail and healthcare sectors partly offsetting the loss of jobs in the information sector.

Light Sweet Crude Oil futures for October delivery, the most actively traded contract, soared $2.16 or 2.00 percent to close at $110.53 a barrel on the New York Mercantile Exchange Friday.

Crude prices for October delivery scaled a high of $110.70 a barrel intraday and a low of $108.12.

Yesterday, oil gained over 1 percent after an Energy Information Administration weekly report showed U.S. crude stockpiles to have dropped much more than expected, and on supply concerns with possibilities of military action against Syria on the horizon. Oil prices also gained from some upbeat macroeconomic data out of the U.S., despite the dollar trading higher against a basket of major currencies.

The Energy Information Administration on Wednesday said U.S. crude oil inventories dipped 1.80 million barrels and gasoline stocks shed a similar 1.80 million barrels in the weekended August 30. Analysts expected crude oil inventories to ease 0.20 million barrels and gasoline stocks to shed 0.60 million barrels last week.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 82.15 on Friday, down from 82.63 late Thursday in North American trade. The dollar scaled a high of 82.63 intraday and a low of 82.04.

The euro traded higher against the dollar at $1.3183 on Friday, as compared to its previous close of $1.3120 late Thursday in North America. The euro scaled a high of $1.3189 intraday and a low of $1.3106.

In economic news from the U.S., the Labor Department said non-farm payroll employment increased by 169,000 jobs in August compared to economist estimates for an increase of about 175,000 jobs. The report also showed a notable downward revision to the pace of job growth in July, with the revised data showing an addition of 104,000 jobs compared to the previously reported increase of 162,000 jobs. Despite the weaker than expected job growth, the unemployment rate dipped to 7.3 percent in August from 7.4 percent in July. The unemployment rate had been expected to come in unchanged.

From the eurozone, Germany's foreign trade surplus decreased more than forecast by economists in July amid a fall in exports, data from the Federal Statistical Office revealed. The trade surplus fell to EUR16.1 billion in July from EUR 17 billion in June. Economists had forecast a surplus of EUR 16.5 billion. In calendar and seasonally adjusted terms, the surplus was EUR 14.5 billion.

Meanwhile, Germany's industrial production decreased in July at a notably faster rate than economists had forecast, latest data showed. Industrial production fell a seasonally and calendar-adjusted 1.7 percent in July from the previous month, marking a deterioration from June's 2 percent increase, preliminary data released by the Federal Ministry of Economics and Technology showed. Economists had forecast production to record a 0.5 percent contraction in July

Elsewhere, British industrial production decreased in July, the latest figures from the Office for National Statistics revealed. Production declined 1.6 percent year-on-year in July, reversing a 1.4 percent increase in June. This compares with forecast for a 1.7 percent fall.

Britons' inflation expectations have eased from May and the proportion of respondents expecting an interest rate hike in the next 12 months was the lowest since 2008, results of a key survey from the Bank of England revealed.