* US service sector contracts unexpectedly in November
* New U.S. weekly unemployment claims lowest in 14 months
* ECB keeps main interest rates as expected at 1 pct
(Updates throughout, changes dateline from previous LONDON)
NEW YORK, Dec 3 (Reuters) - Oil prices fell on Thursday as
weak U.S. service sector data and high U.S. crude and gasoline
inventories offset losses in the dollar.
Data showed the U.S. services sector unexpectedly
contracted in November. An index measuring activity fell to its
lowest reading since July and pressured U.S. stocks [].
[]
U.S. crude for January delivery <CLc1> fell 35 cents to
$76.25 a barrel by 12:05 p.m. (1705 GMT). Brent crude <LCOc1>
rose 25 cents to $78.13 a barrel.
Oil traders have watched wider macroeconomic factors this
year for signs of a turnaround in the economy that could
support flagging fuel demand.
Investors have taken cash out of oil and other commodities
and into safe haven plays like the dollar at times this year
when negative economic data is released.
Data was mixed on Thursday as new applications for U.S.
jobless benefits unexpectedly fell last week to the lowest
level in more than 14 months, suggesting a labor market edging
toward stability, while productivity was less robust in the
third quarter. []
The White House said a recent private sector payroll report
had signaled that November's unemployment level may tick up
from 10.2 percent in October, but stressed it was not
predicting the outcome of Friday's closely watched monthly
payroll data. []
Crude prices tumbled on Wednesday after the release of U.S.
inventory data, which showed U.S. crude and gasoline
inventories jumped last week as the weak economy continued to
batter demand in the world's top consumer. []
"The inventory situation is still providing a bearish
backdrop. But the dollar fell very close to recent lows versus
the euro, providing a lift to energy." said Tom Bentz, analyst
at BNP Paribas Commodity Futures in New York.
The euro clung to gains against the U.S. dollar after the
European Central Bank announced its first steps to unwind some
of the extraordinary measures it took to prop up the euro zone
economy during the global crisis. []
Speaking after the ECB kept rates at a record low of 1
percent as expected, ECB President Jean-Claude laid out a
number of decisions on ending and tightening up the measures it
has taken to support liquidity in the banking sector.
[]
Kuwaiti Oil Minister Sheikh Ahmad al-Abdullah al-Sabah told
reporters the OPEC nation preferred oil prices remain in the
$70-80 a barrel range, adding he supported leaving crude output
targets unchanged when the producer group meets on Dec. 22 in
Angola. []
OPEC last year agreed to output cuts of 4.2 million barrels
per day as part of efforts to prop up oil prices and balance
markets, after slumping demand sent crude from record highs
near $150 a barrel in July 2008 to below $33 in December 2008.
[]
Adding to OPEC's challenges, the biggest non-OPEC oil
exporter Russia set a fourth consecutive monthly output record
in November, averaging more than 10 million barrels per day.
[]
http://graphics.thomsonreuters.com/129/CMD_OILSPRD1209.gif
(Reporting by Matthew Robinson, Gene Ramos and Robert Gibbons
in New York; Christopher Baldwin in London; Nick Trevethan in
Singapore; editing by Jim Marshall)
((matthew.robinson@thomsonreuters.com: +1 646 223 6052;
Reuters Messaging: matthew.robinson.reuters.com@reuters.net))
