Oil holds ground as traders search for bottom of rout

Thu Jan 8, 2015 5:19pm EST
 
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By Barani Krishnan

NEW YORK (Reuters) - Global oil prices were little changed for a second straight day on Thursday after better-than-expected U.S. jobs data helped the market hold ground after a 10 percent loss earlier in the week.

But support for oil was likely to be short-lived as market bears continue hunting for a bottom to the second-biggest price rout in crude's history, traders said.

Some traders think oil prices could be at a crossroads after losing over half their value from June highs, and that could explain benchmark Brent's stalling at above $50 since Wednesday. Others believe the market has just been handed a reprieve before being hammered lower.

"I think there is selling fatigue and that's why you're seeing some short covering," said John Kilduff, partner at New York energy hedge fund Again Capital. "There are lots of folks out there still looking for a bottom. This thing is not over yet. Not by a long shot."

Brent crude LCOc1 settled down 19 cents at $51.15 a barrel. It had dropped to $49.66 on Wednesday, its lowest since spring 2009.

But U.S. crude CLc1 finished up 14 cents at $48.79, after plumbing a 5-1/2-year low of $46.83 in the previous session.

Brent had lost more than $5, or about 10 percent, in total in the first two days of this week.

Data on Thursday showed jobless claims in the United States fell last week, while a separate report said U.S. employers announced a total of 483,171 job cuts in 2014. That was 5 percent fewer than in 2013 and the smallest number since 1997.   Continued...

 
A man fills up his car at a petrol station in Rome January 6, 2015.  REUTERS/Max Rossi