Oil tumbles below $76 on U.S. economic data
NEW YORK (Reuters) - Oil tumbled below $76 a barrel on Friday, dragged down as U.S. economic data fell below expectations and helped send stock markets down again.
U.S. oil CLc1 fell $1.00 to $75.86 a barrel by 1:58 p.m. EDT after hitting a record $78.77 on Wednesday. London Brent LCOc1 slipped 72 cents to $75.04.
U.S. stocks fell on Friday after a report showing weaker-than-expected job growth last month was followed by a report of slowing service-sector growth, rattling investors already nervous about losses in the mortgage industry. .N
The U.S. service sector grew much more slowly in July, according to a report by the Institute for Supply Management.
"Crude futures are down as the stock markets are selling off a little bit because the latest U.S. unemployment numbers are weaker than expected," said Phil Flynn, analyst at Alaron Trading. "It's Friday and people are also taking a little profit from the recent highs."
The losses came as Colorado State University trimmed its forecast for the 2007 Atlantic storm season on Friday and predicted 15 tropical storms, with eight growing to hurricane strength, including four major hurricanes.
The updated forecast was lower than the team's May 31 forecast for the six-month storm season that runs through November 30, which had predicted 17 tropical storms, nine hurricanes and five major hurricanes.
The formation of Atlantic storms this week reminded traders of the approaching peak of the hurricane season, but a tropical wave in the eastern Caribbean now appears less likely to become a cyclone.
OPEC SUPPORTS
Prices have been supported this week by comments from OPEC ministers who said the producer group would not increase output when it next meets in September. Some analysts have forecast prices could spike as high as $95 a barrel later this year unless OPEC opens the taps.
Top consumer the United States is worried that as refiners returning from outages ramp up runs, crude stocks will drain rapidly and tighten supplies.
U.S. Energy Secretary Sam Bodman on Thursday warned that oil prices have placed the world's largest economy in a "danger zone" and urged OPEC to raise output.
"People are concerned about overall crude and product stocks globally, as demand's still strong," said Gerard Rigby of Fuel First Consulting in Sydney.
OPEC officials are also concerned by oil at $80, but with U.S. crude inventories still well above historical norms the group is hesitant to increase output.
Qatari Oil Minister Abdullah al-Attiyah said OPEC can do nothing about high prices as there was no shortage of crude. ID:nL02756052
(Additional reporting by Matthew Robinson in New York; Felicia Loo in Singapore; Randy Fabi and Peg Mackey in London)
