Oil Slides Toward Multiyear Lows

By Mark Williams

Columbus, Ohio -- Oil prices slid closer to a new multiyear low Thursday because of growing doubts that the $789 billion stimulus package will reinvigorate the U.S. economy and demand for energy.

Light, sweet crude for March delivery fell 59 cents to $35.35 a barrel on the New York Mercantile Exchange. The contract has closed lower every day this week and on Thursday, dipped as low as $34.26.

There were also more signs of economic weakness.

The number of Americans requesting first-time unemployment benefits dropped slightly last week, but remained near a 26-year high as companies lay off thousands of workers amid a deepening recession. The Commerce Department said the number of initial jobless benefit claims dropped to a seasonally adjusted 623,000, from an upwardly revised figure of 631,000 the previous week. The latest tally still was above analysts' expectations of 610,00 claims.

The 631,000 figure was the highest number since October 1982, when the economy was emerging from a steep recession, though the labor force has grown by about half since then.

In a sign that laid-off workers are having difficulty finding new work, the number of people claiming benefits for more than one week rose to 4.81 million from 4.78 million, the highest total since records began in 1967. The continuing claims data lags the new claims numbers by one week.

Retail sales surprised analysts by rising 1% in January, reversing a six-month trend. Analysts said the rise was unlikely to last though and that much of the increase was due to rising gasoline prices.