Oil prices tumble as Europe and U.S. shed jobs

NEW YORK -- Oil prices tumbled to their lowest level in a month Thursday following the release of woeful job numbers in Europe and the U.S.

Benchmark crude for August delivery fell $2.58, nearly 4%, to settle at $66.73 a barrel on the New York Mercantile Exchange.

Crude hit an eight-month high in midday trading Tuesday, but prices have fallen at the close for five straight days now.

Nymex is closed Friday for the July Fourth holiday.

On Thursday, a Labor Department report showed the U.S. economy lost a larger-than-expected 467,000 jobs in June. The unemployment rate climbed to 9.5% from 9.4% in May, underscoring concerns about the pace of economic recovery.

Since the recession began in December 2007, the economy has lost a net total of 6.5 million jobs.

That has destroyed demand for energy on numerous levels. Employees who have lost jobs or are in fear of losing jobs are driving less and buying fewer goods, many of them petroleum based. Factories have curbed production and are using less natural gas and electricity.

U.S. stores of natural gas continue to grow as energy demand has weakened. The government reported that the nation's surplus grew more than expected last week, and is now 21% above the five-year average.

The job numbers in the U.S. came on the heels of an awful employment picture in Europe.

Unemployment in the 16 countries that use the euro spiked to a ten-year high in May. The seasonally adjusted unemployment rate for the euro zone in May stood at 9.5%.

After rising 41% in the second quarter, which ended Tuesday, energy prices have begun to fall.

Oil prices have doubled since March, when the Fed committed $1.2 trillion dollars to prop up the banking industry. Investors poured money into commodities like oil as a hedge against inflation, and foreign traders found they had more buying power as the dollar weakened.