Crude prices rose by more than $3 on Friday, 02 May, 2008. Price rose after reports that Turkish planes bombed bases of separatist Kurds in northern Iraq. But for the week, price closed lower by almost 2%. During the week, crude price began to slip as the dollar strengthened against its rivals. The same reduced the commodities' appeal as a hedge against inflation. Prices also continued to slip for the third straight day after weekly inventory report by the Energy Department showed that crude supplies rose more than forecast.
Crude-oil futures for light sweet crude for June delivery closed at $116.3/barrel (higher by $3.8/barrel or 3.4%) on the New York Mercantile Exchange. Last Monday, 28 April, 2008, prices touched a historic high of $119.9/barrel. For the year, crude is up by 20.6% till date.
EIA reported earlier this week that U.S. crude oil imports averaged 10.2 million barrels per day last week, up 174,000 barrels per day from the previous week. Traders had anticipated that U.S. crude-oil supplies advanced 950,000 barrels in the week ended 25 April. Crude inventories were boosted by increasing imports. U.S. refineries operated at 85.4% of their operable capacity last week, down 0.2% from the last week.
On the currency markets on Friday, U.S. dollar rallied against most other major currencies. The dollar index, which tracks the performance of the greenback against a basket of currencies, was up 0.4% to 73.53.
On Friday, the job report was out where unemployment rate for April fell to 5% from 5.1% in March. April's unemployment rate was less than the consensus estimate of 5.2%. Nonfarm payrolls for April slipped by 20,000, which is less than the revised decline of 81,000 experienced in March and also less than the 75,000 decline economists expected. Importantly, these figures do not reflect the kind of weakness often associated with a recession.
Against this backdrop, June reformulated gasoline gained 8.82 cents at $2.9664 a gallon and June heating oil rose 10.1 cents at $3.2187 a gallon. June natural gas futures rose 20.4 cents to $10.765 per million British thermal units.
Crude had ended FY 2007 substantially higher by $35 or 57%. It was crude's biggest yearly gain in five years.
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