| News | The dollar's advance following the US jobs report pushed oil prices below $101.00 |
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| Analysis | Although the US jobs data proved to be very positive improving the outlook for the global recovery, oil prices fell in the afternoon session as the USD advanced on optimism the US economic recovery is strengthening, trading around 81.30 the highest since Dec. 2010, adding to pressures on the high yielding assets. Meanwhile worried over Europe's widening debt crisis persist, pushing the euro further to the downside, trading around its lowest since Sep. 2010, adding more downside pressures on the commodities, including crude oil and gold which is trading around $1616.85 from the opening at $1622.52. The U.S. unemployment rate unexpectedly fell to 8.5% in Dec. from 8.7% expected the lowest since February 2009, while the economy added 200 K jobs from 155 K expected, meanwhile in Europe confidence in the economic outlook fell to a two-year low, which determined investors to seek safe haven. Thereby crude oil fell today around the $101.00 per barrel level although tensions over Iran which could create a supply disruption still persist, as Iran continues to threaten shutting down the Strait of Hormuz to shipping, while Europe is considering banning oil imports from Iran. However the euro-zone's debt crisis is keeping investors worried and cautious, since a possible recession in the region which could weigh down on growth in the US and China, might slow demand on oil. An unexpected rise to 2.2 million barrel in U.S. crude stockpiles also weighed down on oil prices. Crude is trading as of this writing with a downside momentum around the $101.00 per barrel level, compared with the opening at $101.29. The highest today was of $102.77 per barrel, yet it fell to the lowest of $100.86 per barrel. Brent is also moving to the downside trading around $112.55. |
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