Oil touches $70, then backs down

Crude futures surge to a 6-month high after a better-than- expected U.S. jobs report, but then retreats.

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 Catherine Clifford, CNNMoney.com staff writer

New GM's new cars
GM is launching a slate of new products. Can they give a lift to the auto giant as it enters a new era?
How secure do you feel in your job?
  • Extremely secure
  • Fairly secure
  • A little insecure
  • Not secure at all

NEW YORK (CNNMoney.com) -- Oil prices closed lower Friday, after briefly rising to a 6-month high above $70 a barrel, as investors took the government's latest employment report as an indication of the improving health of the U.S. economy.

Prices surged to $70.32 a barrel immediately following the report, but turned lower as the day progressed. Crude ended the session down 37 cents at $68.44 a barrel.

The oil market pays particular attention to the health of U.S. economy, the world's largest consumer of energy.

Job losses slowed dramatically in May, according to the latest government reading on the labor market. May's job losses were the fewest since last September.

The stronger U.S. dollar, thanks to the jobs report, also contributed to oil's retreat. The euro lost 1.4% against the dollar, the pound was down 1% against the dollar and the greenback surged 1.8% against the Japanese yen.

A stronger greenback weighs down the price of oil because the dollar is used as the currency for oil all over the globe, and so when the dollar strengthens, oil becomes more expensive in other currencies.

Also supporting oil prices, Goldman Sachs (GS, Fortune 500) released a research report Thursday raising its 3-month price target for crude oil to $75 a barrel from $52 a barrel. By the end of 2009, the report predicts oil will reach $85 a barrel, up from $65 a barrel. And by the end of 2010, Goldman forecasts that crude will hit $95 a barrel.

"When Goldman Sachs starts to talk bullish the market seems to move like it just got an offer that it just can't refuse," said Phil Flynn, senior market analyst at Alaron Trading, in his daily research note.

Oil prices have nearly doubled since the end of the year. The price of gasoline has been pulled higher, as well.

The national average price for a gallon of regular unleaded gasoline increased to $2.592, up 2 cents from the previous day's price of $2.572 according to motorist group AAA.

In the last 38 days, the average price of gas has increased 54.4 cents per gallon.  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
10 of the most luxurious airline amenity kits When it comes to in-flight pampering, the amenity kits offered by these 10 airlines are the ultimate in luxury More
7 startups that want to improve your mental health From a text therapy platform to apps that push you reminders to breathe, these self-care startups offer help on a daily basis or in times of need. More
5 radical technologies that will change how you get to work From Uber's flying cars to the Hyperloop, these are some of the neatest transportation concepts in the works today. More
Worry about the hackers you don't know 
Crime syndicates and government organizations pose a much greater cyber threat than renegade hacker groups like Anonymous. Play
GE CEO: Bringing jobs back to the U.S. 
Jeff Immelt says the U.S. is a cost competitive market for advanced manufacturing and that GE is bringing jobs back from Mexico. Play
Hamster wheel and wedgie-powered transit 
Red Bull Creation challenges hackers and engineers to invent new modes of transportation. Play

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.