Crude Oil Falls in New York on Renewed Growth Concern After Two-Day Rally

Oil fell in New York on speculation the biggest two-day rally in seven months was exaggerated amid U.S. unemployment and signs of slowing global demand for crude.

Futures slipped as much as 0.6 percent, paring the first weekly increase in three. OPEC will keep shipment levels unchanged through most of this month as the economic slump constrains demand, tanker-tracker Oil Movements said. The jobless rate in the U.S., the world’s biggest crude user, held at 9.1 percent for a third month in September, a Labor Department report may show today. A technical indicator signaled oil-price rises aren’t justified by buying momentum.

“Payroll data tonight is going to be really important,” Jonathan Barratt, a managing director of Commodity Broking Services Pty in Sydney, said by telephone today. “That’ll dictate the move.”

Crude for November delivery dropped as much as 47 cents to $82.15 a barrel in electronic trading on the New York Mercantile Exchange and was at $82.26 at 12:42 a.m. Sydney time. The contract yesterday climbed $2.91 to $82.59, for a two-day gain of 9.1 percent, the biggest since Feb. 22-23. Prices are up 3.9 percent this week and down 10 percent this year.

Brent oil for November settlement was at $105.29 a barrel, down 44 cents, on the London-based ICE Futures Europe exchange. The European benchmark contract was at a premium of $23.03 to New York crude, compared with a record of $26.87 on Sept. 6.

OPEC Exports

New York crude’s moving average convergence-divergence, an indicator of trading momentum, remained below zero on the weekly chart even as prices increased, according to data compiled by Bloomberg. Investors typically look for positive momentum to sustain buying of contracts.

The Organization of Petroleum Exporting Countries will export about 22.72 million barrels a day in the four weeks to Oct. 22, little changed from the 22.74 million a day shipped in the month to Sept. 24, Halifax, England-based Oil Movements said yesterday in a report. Shipments typically rise at this time of year as refiners prepare to boost production of winter fuels. The figures exclude Ecuador and Angola.

U.S. employment increased by 55,000 workers last month, according to economists surveyed by Bloomberg News before today’s report. The jobless rate has been at 9 percent or higher since April.

Oil surged yesterday after the European Central Bank President Jean-Claude Trichet announced a bond-purchase program to tame the region’s debt crisis, while the Bank of England unexpectedly expanded its bond-purchase program in the first loosening of U.K. monetary policy since 2009.

To contact the reporter on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net

To contact the editor responsible for this story: Paul Gordon in Hong Kong at pgordon6@bloomberg.net

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