Oil prices dip, investors wait on cues from US jobs data

[SINGAPORE] Oil prices eased in Asian trade on Friday as investors turned cautious ahead of US jobs data later in the day that is expected to play into the Federal Reserve's decision on the timing of any US rate hike.

Oil stuck to a narrow range in thin trading, with Chinese markets closed a second day for a holiday to commemorate the end of World War Two. "There's been a little bit of up and down and range-bound movement, which has all the hallmarks of a market marking time," said Ben Le Brun, market analyst at Sydney's OptionsXpress.

Brent crude for October delivery fell 22 cents to US$50.46 a barrel as of 0357 GMT, after ending the previous session 18 cents higher. Brent rose as high as US$50.87 a barrel when trading began on Friday US crude for October delivery, also known as West Texas Intermediate, was down 21 cents at US$46.54 a barrel, off the day's high of US$46.85. It had settled 50 cents higher in the previous session.

US non-farm payroll and unemployment data for August is due for release at 1230 GMT. "If nonfarm payrolls turn out better, oil prices could increase as there would be more bullishness on the US economy," said Phillips Futures in a note on Friday.

A weak payroll figure could push prices down, causing the WTI and Brent benchmarks to test support at US$44.92 and US$49.69, respectively, the note added.

US fiscal policymakers are likely to use the jobs data as part of their assessment on whether to raise interest rates this year at the next meeting of the US Federal Reserve federal open market committee on Sept 16-17.

A strong dollar remained a "clear and present danger" for the oil markets, Mr Le Brun said. A firm greenback makes oil and other commodities priced in dollars more expensive for holders of other currencies.

Investors are also keeping an eye on US. oil rig data due later on Friday. Any drop in rig numbers could bolster oil's price outlook.

BNP Paribas lowered its price forecasts for oil on Thursday to US$56 a barrel for 2015 and US$62 for 2016 for Brent, and to US$51 a barrel in 2015 and US$56 in 2016 for US crude.

REUTERS