* U.S. service sector improves in August
* Jobless claims disappoint
* Wall Street stocks inch up on retail sales
* OPEC meeting next week set to keep targets unchanged
(Recasts, updates throughout, previous dateline LONDON)
By Rebekah Kebede
NEW YORK, Sept 3 (Reuters) - Oil prices steadied on
Thursday as economic optimism from data showing that the U.S.
service sector and retail sales improved was tempered by
disappointing news from the labor market.
U.S. crude prices for October delivery <CLc1> rose 2 cents
to $68.07 a barrel by 11:44 a.m. EDT (1644 GMT), after earlier
reaching a high of $69.40 on U.S. stock gains and a weaker
dollar.
London Brent crude <LCOc1> was down 32 cents at $67.34 a
barrel.
"Right now, there's not a whole lot of momentum here in
either direction. I think the trend for the week, which has
been down, is still in force," said Tom Bentz, senior commodity
analyst, BNP Paribas commodity Futures Inc in New York.
"Everything seemed to kind of slip right after the jobs
data," he added.
U.S. jobless claims fell last week, according to a report
released by the Department of Labor on Thursday, but the prior
week's figure was revised up.
The number of people collecting long-term unemployment
benefits rose to 6.23 million in the week ended Aug. 22, well
above market expectations for 6.12 million. []
U.S. stocks edged up on Thursday on better-than-expected
sales from retailers in August. []
The Institute for Supply Management released a report on
Thursday showing that while the U.S. services sector shrank in
August, an index measuring activity was at its highest in
nearly a year.
RANGEBOUND
Oil prices are not likely to break out of the confines of
the current range in the short term, analysts said.
U.S. crude prices have been rangebound, between $65 to $75
a barrel since the start of August, fluctuating on the latest
clues about the speed of an impending economic recovery.
"There isn't the structural tightness for the market to
break out of this range," said Petromatrix analyst Olivier
Jakob, pointing to brimming global distillates such as diesel
stored on land and at sea.
Traders were also eyeing news that big oil producers are
increasing output. Russian oil output hit a record high in
August, nearing 10 million barrels per day as the country
launched a new giant field. []
OPEC is expected to leave output targets unchanged when it
next meets on Sept. 9 in Vienna. []
(Additional reporting by Emma Farge and Catherine Bosley in
London; Robert Gibbons and Gene Ramos in New York City; Editing
by Lisa Shumaker)
