NEW YORK (Reuters) —
Prices of U.S. oil
rose on Thursday after falling to near three-week lows as traders
reconsidered the geopolitical risk posed by worsening diplomatic
relations over Russia's intervention in Crimea.
The American benchmark fell by more than $1 about two hours before
the settlement, then reversed losses to end the day higher after
comments from U.S. President Barack Obama indicated the crisis
between Ukraine and Russia, one of the world's biggest oil
producers, was not easing as much as traders thought.
"The relief sell-off was probably premature in terms of thinking the
(Ukraine) situation has resolved itself," said John Kilduff, partner
at Again Capital, LLC in New York. "The president's remarks reminded
everyone that the situation is far from resolved."
U.S. crude fell to an intra-session low of $100.13 at 12:56 p.m.
EST, where it found support near the 200-day moving average of
$100.02. U.S. oil settled 11 cents higher at $101.56 per barrel.
Brent settled 34 cents higher at $108.10, but was not able to push
higher than its 200-day moving average.
Obama's comments came hours after he ordered sanctions on people
responsible for Moscow's military intervention in Ukraine, including
travel bans and freezing of their U.S. assets.
Crimea's Moscow-backed parliament voted to allow the southern
Ukrainian region to become part of Russia earlier on Thursday.
Also supporting U.S. crude, jobless claims fell by 26,000 to a
three-month low last week, a positive sign for the labor market,
according to data released Thursday. But manufacturing activity
slowed in January, indicating a potential fall in energy demand.
Capping gains in oil were the record high levels of U.S. crude
inventories on the Gulf Coast that had built up ahead of refinery
maintenance season when demand typically falls.
Traders awaited Friday's nonfarm payrolls data for a fuller
indication of economic strength in the world's largest oil consumer.
A Reuters survey forecast an increase of 149,000 jobs in February,
stronger than the weather-depressed gains of 113,000 in January and
75,000 in December.
Nonfarm payrolls are due to be released Friday at 8:30 a.m. EST
(1330 GMT).
(Additional reporting by Shadi Bushra
and Peg Mackey in London, and Jacob Gronholt-Pedersen in Singapore;
editing by David Evans, William Hardy, Marguerita Choy and Meredith
Mazzilli)
The American benchmark fell by more than $1 about two hours before
the settlement, then reversed losses to end the day higher after
comments from U.S. President Barack Obama indicated the crisis
between Ukraine and Russia, one of the world's biggest oil
producers, was not easing as much as traders thought.
