DTN Oil

WASHINGTON (DTN) -- Crude and refined products futures on the New York Mercantile Exchange and Brent crude on the Intercontinental Exchange trimmed overnight gains to settle Thursday's session shallowly mixed. The moves came as the U.S. dollar index pared losses after falling to a seven-week low at 89.675 after better-than-expected data for jobless claims, and consumer spending indicated the economy's fundamentals continued to improve in the first quarter.

The U.S. dollar index, which tracks the greenback against six global peers, ended the session above 90 at 90.135 and strengthened in after-hours trade, pressuring oil futures. The greenback edged off the February low after weekly unemployment claims fell last week to the second-lowest level since the onset of the pandemic, at 730,000, with the large states of California and Ohio behind the improvement.

The decrease in jobless applications coincides with expanded vaccination efforts, giving Americans confidence the pandemic will end, while hiring is picking up. The United States has administrated over 65 million doses since the onset of the vaccination program on Dec. 14, 2020, placing the Biden administration well ahead of its goal of 100 million vaccinations in his first hundred days as president. The rate of new infections and hospitalizations declined sharply since its winter peak, prompting some health officials to suggest the country has finally turned the corner in this pandemic.

Further spurring gains for the greenback, durable goods orders, a subset of retail sales, jumped above expectations to 3.4% in January, suggesting consumers are still willing to dig into their wallets even as the unemployment rate remains high. Durable goods orders increased by the most since June 2020 when the economy first emerged from a nationwide lockdown, unleashing pent-up demand from weeks of quarantine in spring. These data points bode well for the economy's rebound for the second and third quarters.

Analysts note fiscal relief, paired with widespread vaccinations and prospects of infrastructure spending later this year, should further support business activity in the months ahead. The Atlanta Federal District Bank's GDPNow model upgraded its first-quarter forecast for U.S. gross domestic product to 9.5% as of Feb. 18, up from 4.5% seen earlier this year.

The Bureau of Economic Analysis in its second of three estimates released Thursday morning nudged up real gross domestic product for the U.S. economy in the fourth-quarter 2020 by 0.1% for annualized growth of 4.1%.

On the session, West Texas Intermediate futures for April delivery added 31 cents to finish at $63.53 per barrel (bbl), and front-month Brent futures on ICE slipped 16 cents below $67 per bbl ahead of expiration Friday afternoon. May Brent maintained its discount to the April contract at 77 cents in afternoon trade, settling the session at 66.11 per bbl. NYMEX March ULSD futures settled little changed at $1.9066 per gallon, with the April contract ending at an 0.87-cent discount to the front month ahead of Friday's March contract expiration. Front-month RBOB futures softened to $1.8923 per gallon, while the April contract settled at a steep 8.41-cent premium, reflecting the transition to lower Reid vapor pressure gasoline specifications next week.

Liubov Georges can be reached at liubov.georges@dtn.com