Crude oil fell on Friday as the price has been hovering around the $97.50 a barrel level throughout the whole week in anticipation for the key US jobs data due later in the day that may add to recent signs of economic improvement in the world`s top oil consumer.
Large price swings for crude are not expected ahead of the US non-farm payrolls data. Expectations show there might be a recovery in the US jobs growth to 185,000 in January from a merely 74,000 new jobs added in December.
This would be added to the stronger-than-forecast economic data on Thursday that bolstered the outlook for fuel demand in the US when the jobless claims fell by 20,000 last week to 331,000, which could help crude end the week with gains.
However, if today’s data will turn out to be much stronger than expected, crude may fall amid believes the economic growth in the US could prompt the Federal Reserve to curb a monetary stimulus program that has helped support the commodities.
“I think the market will be fairly tolerant and not really think in terms of tapering unless we see very good or very bad numbers”, said Ric Spooner, chief market analyst at CMC Markets in Sydney.
Crude may also find support from the possibility of a winter storm arriving this weekend in the US Northeast, which is still clearing snow from two systems earlier this week. Distillate inventories, including heating oil and diesel, shrank for a fourth week last week the EIA showed.
Oil prices are also expected to be aided by peak refinery maintenance season as a number of refiners in the US and Asia will shut down, while tighter supply of North Sea crude in March could support the Brent benchmark.
Investors will also keep an eye on Saturday`s talks between Iran and the world powers amid hopes Tehran will be persuaded to finally start addressing the suspicions regarding its worked on designing a nuclear bomb.
- WTI crude oil futures for March is trading around $ 97.57 a barrel after falling $0.27
- Brent futures for March settlement is trading around $ 107.16 a barrel after falling $0.03
- Natural gas is trading at $ 4.955 per cubic feet after rising 0.49%
- Gasoline is trading at $ 2.6836 per cubic feet after rising 0.02%
- Heating oil (diesel) is trading at $ 2.9993 a gallon after rising 0.14%