By Polya Lesova, MarketWatch
NEW YORK (MarketWatch) -- Crude oil futures lost early gains on Friday, after government data showed the U.S. trade deficit widened more than expected and with the market still digesting news of rising crude inventories.
December crude oil futures were down 85 cents, or 1%, at $76.09 a barrel in electronic trade on Globex. It earlier rose to $77.28 a barrel, receiving a boost as the dollar fell against other major currencies.
Crude earlier rebounded as the dollar fell against other major currencies.
But gains were lost after government data showed the U.S. trade deficit widened more than expected to $36.5 billion in September, while import prices rose 0.7% last month.
"This morning, crude oil rose slightly, supported by a weaker U.S. dollar," wrote analysts at Sucden Financial Research, in a note to clients. "However, investors could remain cautious due to high levels in crude and refinery inventories," they said.
The dollar index (DXY 75.47, -0.12, -0.16%) , which tracks the performance of the greenback against a basket of other major currencies, was slightly weaker, fell 0.2% to 75.481, after slumping to a 15-month lows of 74.77 earlier in the week.
The dollar and oil prices have had a strong inverse relationship in recent months; when the dollar weakens, oil prices tend to rise.
Oil futures sank 3% Thursday after government data showed weak demand and higher imports pushed up U.S. inventories last week.
Crude inventories rose by 1.8 million barrels, while analysts polled by Platts had expected an increase of 1 million barrels.
U.S. stock futures edged higher on Friday, helped by a stronger-than-forecast profit at Walt Disney (DIS 29.83, +0.78, +2.69%) . Investors are awaiting U.S. data on November consumer sentiment.
The Energy Information Administration will release data on natural-gas inventories at 10:30 a.m. Eastern on Friday, a day later than usual because of the Veteran's Day holiday.
Analysts surveyed by Platts expect an addition of between 14 billion and 18 billion cubic feet to natural gas storage inventories for the week ended Nov. 6.
