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On Friday, crude oil lost 1.22% as disappointing jobs report and ceasefire agreement between Ukraine and pro-Russian separatists weighed on the price. As a result, light crude extended losses and approached the recent lows. Will we see a test of the strength of the Jan low in the coming days?
On Friday, the Department of Labor reported that the U.S. economy added 142,000 jobs in August, missing expectations for a 225,000 increase. Additionally, the report showed that the U.S. unemployment rate ticked down to 6.1% last month, from 6.2%, but in line with expectations. These disappointing numbers pointed to a potential weakening of the
economy, fueling fears that the world’s largest oil consumer may demand less energy and fuel.
On top of that, Ukraine signed a ceasefire deal with pro-Russia rebels, which was also bearish for the commodity (as a reminder, Russia is the world’s second-largest exporter and such agreemnt eased fears over the instability in the eastern Ukraine and disruption of Russian oil exports). In this environment, crude oil hit an intraday low of $92.86, approaching the recent lows. Will we see further deterioration in the coming days? (charts courtesy of http://stockcharts.com).