NEW YORK, N.Y. – Oil closed at the lowest level since June on Tuesday as recent data indicate there is plenty of supply to meet current demand.
Benchmark West Texas Intermediate crude for November delivery dropped $1.42, or 1.4 per cent, to close at US$97.80 a barrel on the New York Mercantile Exchange. That’s the lowest close since June 28.
The November contract expires Tuesday. The more heavily traded December contract fell $1.38 to $98.30 a barrel.
The U.S. government said the economy added 148,000 jobs in September, a number that suggests employers held back on hiring before a 16-day partial government shutdown began Oct. 1. It wasn’t a number that signalled an increased need for gasoline for the daily commute.
The jobs data came a day after the Energy Department reported a jump in U.S. crude supplies. The government said Monday that U.S. crude supplies rose by four million barrels in the week ended Oct. 11. The report was delayed five days due to the government shutdown.
Analysts at The Schork Report estimated that U.S. commercial crude oil stocks are at the third-highest level for October since 1930 and 13 per cent above the normal range over the previous decade.
Expectations are that supplies rose by an additional three million barrels last week. The Energy Department reports that figure on Wednesday.
Brent crude, the international benchmark, gained 33 cents to US$109.97 on the ICE Futures exchange in London.
In other energy futures trading on Nymex, wholesale gasoline slipped four cents to US$2.62 a U.S. gallon (3.79 litres), heating oil fell one cent to US$3 a gallon and natural gas dropped nine cents to US$3.58 per 1,000 cubic feet.
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