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Crude oil plunges on profit taking despite closed refineries

Published 11/02/2012, 07:07 AM
Updated 11/02/2012, 07:09 AM
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Investing.com - Crude oil futures plunged lower Friday despite two U.S. east coast refineries staying closed in the wake of storm Sandy as profit taking hit the commodity from the supply numbers induced rally.

On the New York Mercantile Exchange, light sweet crude futures for delivery in December traded at USD86.37 a barrel during European trade, dropping 0.83%. 

Prices rallied over 1% on Thursday, after the U.S. EIA said in its weekly report that U.S. crude oil inventories fell by 2.0 million barrels in the week ended October 26, confounding expectations for an increase of 1.5 million barrels.

Total U.S. crude oil inventories stood at 373.1 million barrels as of last week. 

Prices also gained ground after the Department of Labor said earlier that the number of individuals filing for initial jobless benefits fell to 363,000 last week from 372,000 the previous week, compared to expectations for a decline to 370,000.

The data came on the heels of a report showing that U.S. private sector employment increased more-than-expected in October.

Payroll processing firm ADP said the U.S. private sector added 158,000 jobs this month, surpassing expectations for an increase of 135,000.

Also Thursday, the Institute for Supply Management said its index of purchasing managers rose to a five-month high of 51.7 in October from a reading of 51.5 in September. 

A separate report showed that U.S. consumer confidence rose to the highest level since February 2008 in October.

The U.S. is the world’s biggest oil-consuming country, responsible for almost 22% of global oil demand. 

However, restarts at the refineries closed on Friday remain contingent on post-storm assessments, the companies said. Both were closed before Sandy hit and lost power after the storm made landfall October 29 in southern New Jersey. 

Elsewhere, on the ICE Futures Exchange, Brent oil futures for December delivery eased 0.08% to trade at USD108.06 a barrel, with the spread between the Brent and crude contracts standing at USD21.39 a barrel.



 

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