Oil prices slip on stronger U.S. dollar

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NEW YORK, Nov. 7 -- Oil prices fell Thursday as the U. S. dollar rallied against the euro after the European Central Bank cut its benchmark interest rate to a record low level.

The ECB on Thursday slashed the benchmark interest rate from 0. 5 percent to 0.25 percent to boost economic recovery in the euro zone.

The U.S. economy grew at an annual rate of 2.8 percent in the third quarter before the partial federal government shutdown, the Commerce Department reported Thursday. The figure is well above analysts' estimates of 2 percent and also higher than the 2.5- percent increase in the second quarter.

Also positive were the Labor Department data showing the number of Americans who initially applied for jobless benefits in the week ending Nov. 2 fell 9,000 to hit 336,000.

The stronger-than-expected U.S. economic data and the unexpected ECB rate cut sent the U.S. dollar higher, which in turn made the dollar-priced oil more expensive to investors using other currencies.

Rising energy supplies in the coming years also weighed on oil prices.

The Organization of Petroleum Exporting Countries said it expected growing supplies from U.S. shale oil would contribute to the fall in demand for its own output. It expects demand for its crude oil to fall to 29.2 million barrels a day in 2018 from 30.3 million barrels daily this year.

Light, sweet crude for December delivery went down 60 cents to settle at 94.2 dollars a barrel on the New York Mercantile Exchange,while Brent crude for December delivery lost 1.78 dollars to close at 103.46 dollars a barrel.

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