Oil Rises as Ebbing U.S. Jobless Claims Bolster Economic Outlook

Stronger growth in the picture?

Aug. 9 (Bloomberg) -- Oil rose as reports showed fewer Americans filed applications for unemployment benefits and the U.S. trade deficit declined, signaling economic growth may increase in the world’s biggest crude-consuming country.

Futures climbed as much as 0.9 percent after the Labor Department said initial jobless claims dropped by 6,000 to 361,000 in the week ended Aug. 4. The U.S. trade gap shrank 11 percent to $42.9 billion in June, the smallest since December 2010, Commerce Department figures showed in Washington.

“The positive U.S. economic data is having an impact on crude,” said Jason Schenker, president of Prestige Economics LLC, an Austin, Texas-based energy consultant. “These are positive growth signals. The trade number is a sign that second- quarter GDP will be revised higher.”

Crude oil for September delivery rose 48 cents, or 0.5 percent, to $93.83 a barrel at 11:16 a.m. on the New York Mercantile Exchange. The intraday high was $94.21. Prices are up 21 percent from $77.69 on June 28, the lowest close this year.

 Brent oil for September settlement increased 56 cents, or 0.5 percent, to $112.70 a barrel on the London-based ICE Futures Europe exchange. The European benchmark’s premium to West Texas Intermediate crude, the grade traded in New York, was at $18.87, up from $18.79 yesterday.

 Jobless Claims

 Jobless claims were projected to increase to 370,000 last week, according to the median forecast of 43 economists surveyed by Bloomberg. The trade deficit was estimated to shrink to $47.5 billion, according to the median of responses from 69 economists who replied to the Bloomberg survey.

The better-than-projected trade reading may help boost second-quarter growth figures when the government revises the data this month. The U.S. economy grew at a 1.5 percent annual pace in the April through June period, compared with a 2 percent rate in the previous three months, the Commerce Department reported July 27.

Prices for single-family homes climbed in most U.S. cities in the second quarter and values nationally jumped the most since 2006 as real estate markets stabilized. The median sales price increased from a year earlier in 110 of 147 metropolitan areas measured, the National Association of Realtors said in a report today. In the first quarter, 74 areas had gains.

Oil retreated earlier as the dollar advanced against the euro on concern the Europe’s economy will deteriorate further. The dollar climbed as much as 0.6 percent. A stronger U.S. currency and weaker euro decrease the appeal of dollar- denominated raw materials as an investment.

Chinese Inflation

Slower consumer-price inflation in China may encourage policy makers to add measures to reverse the economic slowdown. Consumer prices rose 1.8 percent from a year earlier, the National Bureau of Statistics said in Beijing. That compared with the 1.7 percent median forecast of 33 economists in a Bloomberg survey and a 2.2 percent gain in June.

 The leaders of China’s ruling Communist Party pledged last week to keep adjusting policies to ensure the economy expands at a stable rate this year. China was the second-biggest crude- consuming country, accounting for 11 percent of global demand in 2011, compared with 21 percent for the U.S., according to BP Plc’s Statistical Review of World Energy released in June.

“The market is in a mode where all that matters is the prospect of central bank monetary stimulus,” said Guy Wolf, a strategist at Marex Spectron Group Ltd., a London-based commodities brokerage. “So soft growth data, without inflationary pressure, is a green light for central banks. Further stimulus in China is almost a certainty.”

The Organization of Petroleum Exporting Countries said in its Monthly Oil Market Report that it will need to supply 29.5 million barrels of crude a day next year. That’s down 100,000 a day from what the 12-member group’s Vienna-based secretariat projected last month.

Iraq’s crude output rose above 3 million barrels a day last month for the first time since the 2003 U.S.-led invasion that toppled Saddam Hussein, OPEC said. Iraq pumped 3.08 million barrels a day in July, 115,000 barrels more than the previous month, the report showed.

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