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Crude gains on upbeat U.S. growth, jobless claims reports

Published 03/27/2014, 01:29 PM
Updated 03/27/2014, 01:31 PM
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Investing.com - Better-than-expected U.S. economic growth and weekly jobless claims data sent oil prices climbing on Thursday, as investors bet an improving U.S. economy will demand more fuel and energy going forward.

On the New York Mercantile Exchange, West Texas Intermediate crude oil for delivery in May traded at $101.57 a barrel during U.S. trading, up 1.31%. New York-traded oil futures hit a session low of $100.04 a barrel and a high of $101.69 a barrel.

The May contract settled up 1.08% at $100.26 a barrel on Wednesday.

Nymex oil futures were likely to find support at $98.82 a barrel, Tuesday's low, and resistance at $102.89 a barrel, the high from March 7.

Oil prices shot up after the Commerce Department reported earlier that U.S. gross domestic product was revised up to 2.6% in the final three months of 2013, up from a preliminary estimate of 2.4%. Market expectations had been for an upward revision to 2.7%.

Still, the report showed that personal spending was revised up to 3.3% from 2.6% initially, the fastest rate of growth in three years, which drew applause from investors betting that sluggish economic indicators hitting the wire earlier this year were the result of rough winter weather that disrupted commerce and not due to an economic soft patch.

Separately, the Labor Department said the number of individuals filing for initial jobless benefits in the U.S. last week declined by 10,000 to a 311,000 from the previous week’s revised total of 321,000.

Analysts were expecting jobless claims to rise by 4,000.

Also supporting both U.S. and European crude blends were concerns the U.S. and Europe may stiffen sanctions on crude-rich Russia and subsequently threaten global oil supply.

Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for May delivery were up 0.60%, trading at US$107.68 a barrel, while the spread between the Brent and U.S. crude contracts stood at US$6.11 a barrel.

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