Oil plunges to 8-month low on weak US jobs report
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Oil plunged to fresh eight-month lows near $82 a barrel Monday in Asia as a dismal U.S. jobs report sparked selling of stocks and commodities.
Benchmark oil for July delivery was down $1.09 to $82.14 per barrel, the lowest since October, in electronic trading on the New York Mercantile Exchange. The contract fell $3.30 to settle at $83.23 in New York on Friday.
In London, Brent crude for July delivery was down $1.07 at $97.36 per barrel on the ICE Futures exchange.
The Labor Department said Friday that employers in the U.S. added just 69,000 jobs in May, the fewest in a year and well below what economists expected. The unemployment rate rose for the first time since last June, up to 8.2 per cent from 8.1 per cent.
"Friday's employment report was so mind-numbingly bad," energy trader and consultant The Schork Group said in a report.
It was the third month in a row of disappointing U.S. job growth, suggesting the economy is slowing and oil demand will likely grow less than expected this year.
Crude has plummeted 23 per cent in the last month amid signs of weak global economic growth. As Europe struggles to contain its debt crisis, signs of sputtering Chinese growth have coupled with a faltering U.S. recovery to undermine investor confidence.
Oil traders often look to global stock markets as a barometer of overall investor sentiment, and Asian equities were sharply lower Monday after the Dow Jones industrial average dropped 2.2 per cent Friday.
In other energy trading, heating oil was down 1.4 cents at $2.61 per gallon while gasoline futures fell 2.2 cents at $2.63 per gallon. Natural gas gained 1.6 cents at $2.34 per 1,000 cubic feet.
