Light oil price trading near $74 on US growth forecast

US Light oil price was steady in trading near $74 on Friday as the recovery of the US economy and recent growth forecasts have yet to boost fuel demand and in turn, oil demand.

The US economy probably grew at an annual rate of 4.6 percent in the fourth quarter, up from 2.2 percent in the third, a Reuters poll showed ahead of the data, due at 1330 GMT.

“Even though the US economy is growing, the key figure is the unemployment rate,” said Clarence Chu, an energy trader at Hudson Capital Energy in Singapore. “Until I see that the US is consistently creating jobs for a few months in a row, I’m not convinced that demand will increase.”

Oil demand in the US shrank two percent in the past four weeks from a year earlier. Japanese crude imports fell 2.6 percent in December and gasoline sales tumbled 2.4 percent, the Ministry of Economy, Trade and Industry (METI) said on Friday.

US Light oil futures for March delivery gained 9 cents to $73.73 a barrel by 0504 GMT. Prices touched $72.65 on Wednesday, the lowest intra-day price since December 21st, and are still down 12 percent from a 15-month high of just under $84 on January 11th, while in London, ICE Brent crude oil futures for March climbed 11 cents to $72.24 on the ICE Futures Exchange.

Prices fell on Thursday after the US dollar rose to its highest level in more than six months against the euro, which fell on concern over potential fiscal crises in European economies including Greece and Portugal. A stronger US dollar often indicates investors are funneling cash away from riskier assets such as commodities including oil prices, it also can curb demand for crude oil from buyers who hold other currencies, since oil is priced in US dollars.

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