Oil up on labor contract concerns

Investors worry about possible refinery strike by 30,000 workers in the United States.

EMAIL  |   PRINT  |   SHARE  |   RSS
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
By Kenneth Musante, CNNMoney.com staff writer

Click the chart to track the latest commodity prices.
How will the economic stimulus package help your job situation?
  • It won't make any difference
  • It will help me find a job
  • It will help me keep my job

NEW YORK (CNNMoney.com) -- Oil prices rose Friday as the possibility of an oil workers' strike in the United States weighed on investors.

U.S. crude for March delivery ended trading up 24 cents to $41.68 a barrel from the day before.

The nation's major oil companies and the United Steelworkers of America - which represents about 30,000 workers at refineries, pipelines, terminals and other oil facilities - have been trying to hammer out a new labor contract.

The union's current contract is set to expire Sunday, and the union has the power to authorize a strike if needed.

"Usually these things get settled, but there is still that uncertainty going into the weekend," said Phil Flynn, senior market analyst with Alaron Trading in Chicago.

Adding to labor-related jitters, refinery workers in Britain staged an unofficial walkout this week at a refinery operated by Total SA (TOT). However the oil company said the job action has not affected production at the facility, which can process about 200,000 barrels per day.

Economy: The slowing economy, which helped drive crude prices down more than $100 a barrel from a record high of $147.27 a barrel last summer, continued to show weakness Friday.

The government said the country's gross domestic product, the sum of all goods and services produced in the U.S., fell at an annual rate of 3.8% last quarter. It was the largest drop in GDP since the first quarter of 1982 when the it contracted by 6.4%.

Investors remain concerned that the slow economy was eating away at demand for crude products. But the drop in GDP was less than the 5.5% expected by economists, according to a poll from Briefing.com.

"At least we're not in a depression yet, but the recession still looms," said Flynn.

Earlier this week, the government said supplies of crude rose by 6.2 million barrels in the week ended Jan. 26, much more than analysts had expected.

OPEC: The Organization of Petroleum Exporting Countries, whose members produce about 40% of the world's oil, has been struggling to meet a production cut of 2.2 million barrels a day in January in order to boost prices in an oversupplied market.

However OPEC is known for routinely falling short on pledged production cuts, and analysts worry it may not be able to cut the entire promised amount.

Gasoline: The retail price of gasoline rose 0.3 cents to a national average of $1.846 a gallon, according to a daily poll of gas station credit card swipes from motorist group AAA. To top of page

They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
More Galleries
17 cool gadgets that tease the future Smart telescopes, surveillance for dogs, an electric roadster and more from CES 2018. More
These 12 airplane beds let you really sleep on a flight For the price of a premium class ticket, you may just get a space that's comfortable, private, and quiet enough to ensure a good rest. More
CES 2018 kicks off with oddball gadgets The biggest tech show of the year opened with a collection of quirky gadgets. More