Oil slips below $104 as supplies set to increase
- Article by: PABLO GORONDI
- Associated Press
- July 4, 2014 - 8:15 AM
The price of crude oil slipped below $104 a barrel Friday, extending its drop to seven straight days, as expectations of increased supply offset strong U.S. employment growth.
By early afternoon in Europe, the benchmark U.S. crude contract for August delivery was down 74 cents to $103.74 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, a benchmark for international oils, was down 63 cents to $110.61 a barrel on the ICE Futures exchange in London.
U.S. markets are closed Friday for the Fourth of July holiday and trading volumes in other markets were thinner than usual.
Crude fell despite signs the U.S. economy is steadily improving, which typically would increase demand for oil. The U.S. government reported that employers added a strong 288,000 workers to their payrolls in June and the unemployment rate fell to 6.1 percent.
The positive economic news, however, also strengthened the dollar, a factor that weighed on oil prices by making crude more expensive — and a less attractive investment — for traders using other currencies.
Oil has been sliding since it reached a 10-month closing high of $107.26 on June 20, when concerns had grown over the stunning advance by Islamic militants in controlling Iraqi territory. Since then, it has become clear that there are no imminent disruptions to supplies from Iraq, OPEC's second biggest producer.
On top of that, an agreement in Libya between the central government and a regional militia was expected to lead to the reopening of two eastern oil terminals that would boost the country's crude exports by about 500,000 barrels a day. Libya currently produces around 350,000 barrels of oil a day.
In other energy futures trading on the Nymex:
— Wholesale gasoline was down 0.99 cent at $3.014 a gallon.
— Natural gas lost 0.5 cent to $4.352 per 1,000 cubic feet.
— Heating oil fell 2.54 cents to $2.9207 a gallon.
© 2014 Star Tribune