Oil dropped in New York, trimming a second weekly gain, on speculation that slower jobs growth in the U.S. may curtail fuel consumption in the world’s largest economy.
Futures fell as much as 1.2 percent before data today that may show companies slowed hiring last month. A tropical depression in the Gulf of Mexico prompted companies including BP Plc and Exxon Mobil Corp. to shut almost 6 percent of the area’s crude output. The storm may approach the Louisiana coast this weekend, according to the National Hurricane Center.
“Demand in the U.S. is rather weak and the latest data does not present many positive signals,” said Eugen Weinberg, Frankfurt-based head of commodities research at Commerzbank AG, who forecasts Brent will average $100 a barrel in the fourth quarter. “Today’s data will be particularly important since it’s last large employment report before the Federal Reserve meets in three weeks.”
Oil for October delivery fell as much as $1.10 to $87.83 a barrel in electronic trading on the New York Mercantile Exchange and was $88.23 at 10:51 a.m. London time. The contract yesterday gained 12 cents to $88.93, the highest close since Aug. 3. Prices are up 3.4 percent this week and have gained 18 percent in the past year.
Brent oil for October settlement was at $113.67, down 62 cents, on the London-based ICE Futures Europe exchange. The European benchmark was at a premium of $25.44 to U.S. futures, up from $25.36 at yesterday’s settlement and compared with a record close of $26.21 on Aug. 19.