Oil prices edged higher on Friday and were on course for a weekly gain of more than 3% as U.S. jobs data eased demand concerns while fears of a widening Middle East conflict continue to raise supply risks.
Brent crude futures were up 32 cents, or 0.4%, at $79.48 a barrel by 1225 GMT. U.S. West Texas Intermediate crude futures rose 38 cents, or 0.5%, to $76.57.
Both Brent and WTI were set to gain more than 3% on a weekly basis.
“Sentiment was also boosted by positive jobs data in the U.S., with new unemployment claims coming in well below expectations,” said Panmure Liberum analyst Ashley Kelty.
“With a larger expected draw in U.S. stockpiles this week, hopes are that the U.S. continues to grow and fears of a recession may look overblown.”
Data showed that the number of Americans filing new applications for unemployment benefits fell more than expected last week, easing recession concerns.
Also offering support was China’s consumer price index (CPI), which rose last month at a slightly faster than expected rate, statistics bureau data showed.
“An uptick in Chinese inflation data supported sentiment. At the same time, the geopolitical situation remains tense, with escalating confrontation risks supporting oil prices,” said George Khoury, global head of education and research at CFI.
Israeli forces stepped up airstrikes across the Gaza Strip on Thursday, killing at least 40 people, Palestinian medics said, in further battles with Hamas-led militants.
The killing last week of senior members of militant groups Hamas and Hezbollah had raised the possibility of retaliatory strikes by Iran against Israel, stoking concerns over oil supply from the world’s largest producing region.
Iran-aligned Houthi militants have also continued attacks on international shipping near Yemen in solidarity with Palestinians in the war between Israel and Hamas.
Lending further support to prices, Libya’s National Oil Corp declared force majeure at its Sharara oilfield from Wednesday, adding that it had gradually reduced the field’s output because of protests.
Source: Reuters (Reporting by Noah Browning in London and Arunima Kumar in Bengaluru Additional reporting by Colleen Howe in Beijing Editing by Jason Neely and David Goodman)