Aug. 3 (UPI) — A mixed U.S. jobs report and data showing total OPEC production were offsetting supply-side strains and left the price of oil searching for direction early Friday.
Crude oil prices started the trading day Thursday in negative territory, but quickly shifted into rally mode on signs that U.S. crude oil stocks at the key storage hub in Cushing, Okla., were drying up. Phil Flynn, a market analyst at the PRICE Futures Group in Chicago, said in a daily emailed market report that was supporting the spike in prices on Thursday.
Meanwhile, a U.S. decision to scale back fuel standards would lead to higher demand, though that could be balanced by trade tensions between the United States and China.
“It is unclear that the higher tariffs proposed by the Trump Administration will ever be imposed and if they are that they will have a major detrimental impact on oil demand,” Flynn said.
On Friday, the U.S. Department of Labor reported total non-farm payrolls increased 157,000 in July, lower than the net average gain of 203,000 over the last 12 months.
James Knightly, the chief international economist at ING, said the latest payroll figures paint something of a mixed picture, though the U.S. economy remains strong.
“There are certainly worries about protectionism and its potential economic impact, but we also have to remember that the stimulus from tax cuts dwarfs the tax hit from higher tariffs,” he said in a Friday report.
Crude oil prices were mixed ahead of the start of U.S. trading on Friday. The price for Brent crude oil, the global benchmark, was up 0.23 percent to $73.62 per barrel as of 9:15 a.m. EDT. West Texas Intermediate, the U.S. benchmark for the price of oil, was down 0.1 percent to $68.89 per barrel.
In terms of supplies, a survey from commodity group S&P Global Platts found total production from members of the Organization of Petroleum Exporting Countries was enough to make up for the losses from Iran, Libya and Venezuela. Saudi Arabia produced at record levels and support from Kuwait and the United Arab Emirates made up for losses elsewhere in the market.
Elsewhere, the U.S. Commerce Department reported an increase in the U.S. trade deficit, reversing course from May for the largest spike in more than a year.
An increase in total imports was driven by a $1.2 billion surge for crude oil in June. A decrease in export value was driven by a $700 million decline from the automotive sector.
U.S. trade policies, meanwhile, continue to rattle investors as the tit-for-tat disputes with China continue. After Trump called for a 15 percent increase in tariffs on Chinese goods earlier this week, Beijing on Friday announced it was targeting $60 billion worth of U.S. goods in response.