Crude oil futures top USD107 a barrel after jobless claims

Investing.com - Crude oil futures advanced on Thursday, re-approaching the highest level since May 2010 after official data showed that the number of people who filed for unemployment assistance in the U.S. fell to a two-month low last week, easing concerns over the U.S. jobs market.

On the New York Mercantile Exchange, light sweet crude futures for delivery in September traded at USD106.96 a barrel during U.S. morning trade, up 0.6% on the day.

New York-traded oil prices held in a range between USD105.94 a barrel, the daily high and a session low of USD107.05 a barrel.

Nymex oil prices rose to a 16-month high of USD107.44 a barrel on July 11.

The U.S. Department of Labor said the number of individuals filing for initial jobless benefits last week fell by 24,000 to 334,000, compared to expectations for a drop of 13,000 to 345,000.

Investors were looking ahead to a second day of testimony on monetary policy by Federal Reserve Chairman Ben Bernanke later in the session.

In the first day of his semi-annual testimony to Congress on Wednesday Bernanke said the central bank could scale back its asset purchases by the end of the year if the economy continues to improve, but added that there was no “preset course.”

Bernanke said the economic recovery was continuing at a moderate pace but reiterated that monetary policy will remain accommodative for the foreseeable future.

The Fed’s stimulus program is viewed by many investors as a key driver in boosting the price of commodities as it tends to depress the value of the dollar.

Oil prices were also boosted after a report from the U.S. government showed that oil supplies fell significantly more-than-expected last week.

The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories fell by 6.9 million barrels last week, compared to expectations for a decline of 2 million barrels.

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

Elsewhere, on the ICE Futures Exchange, Brent oil futures for September delivery shed 0.1% to trade at USD108.52 a barrel, with the spread between the Brent and crude contracts standing at USD1.56 a barrel.

The gap between the contracts narrowed to the smallest level since November 2010, amid an improving production outlook in the North Sea and indications of declining stockpiles at Cushing, Oklahoma, the delivery point for Nymex oil futures.