Oil prices slip after mixed US jobs report

NEW YORK: Oil prices fell on Friday as a stronger dollar made the commodity more expensive and a closely watched US unemployment report came in below expectations.

New York's main contract, light sweet crude for February fell 35 cents to close at $88.03 per barrel.

The futures contract had lost almost two dollars Thursday.

Brent North Sea crude for delivery in February settled at $93.33 per barrel, down $1.19 from Thursday's close.

The Labor Department reported a sharp drop in the unemployment rate in December to 9.4 percent, but at the same time, the economy created 103,000 jobs, much fewer than the 150,000 forecast by analysts.

"The market is reacting to the mixed employment figures... That dampened the prospects of very good growth of petroleum products demand in the US going forward," said independent analyst Andy Lipow.

The US dollar continued to rise against other key currencies, with the euro falling below $1.30 to its lowest level since early December, further discouraging investors from buying oil.

A stronger greenback makes dollar-traded commodities less attractive for investors.

The oil market began 2011 with a bang, striking two-year peaks on Monday on the back of confidence in increased global energy demand after the US economy showed more signs of recovery.

Oil then tumbled on Tuesday as many investors took profits from the impressive rally.

However the market rebounded somewhat Wednesday on upbeat US labor market data and a larger-than-expected fall in American crude inventories, but retreated Thursday as the dollar firmed.