Oil falls as US job growth fails to impress

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by Associated Press

KING5.com

Posted on October 5, 2012 at 7:41 AM

The price of oil fell Friday as traders fretted over job growth in the U.S. despite an unexpected drop in the unemployment rate.

Benchmark oil was down $1.50 to $90.24 per barrel in morning trading in New York. Oil rose about $1 per barrel immediately after the government's report. But the price slipped steadily after that initial burst.

The U.S. Labor Department said the unemployment rate stands at 7.8 percent, the first time it's been below 8 percent in nearly four years. The number of unemployed Americans is now 12.1 million, the fewest since January 2009.

Still, the 114,000 jobs created in September was only in line with what economists had expected.

"That doesn't suggest really strong job growth," Gene McGillian, broker and analyst at Tradition Energy. McGillian said the report, combined with the fact that there are ample supplies of oil and low demand, is driving down prices.

Oil jumped 4 percent on Thursday following a 4 percent decline on Wednesday. Traders are trying to gauge the strength of global oil demand while also watching developments surrounding Syria for any signs of a disruption in supplies from the Middle East.

In London, Brent crude, which is used to price international varieties of oil, was fell 83 cents to $111.75.

Among other energy futures traded in New York:
-- Natural gas retreated 1 cent to $3.40 per 1,000 cubic feet.

-- Heating oil fell 3 cents to $3.16 per gallon.

-- Wholesale gasoline was flat at $2.95 per gallon.

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