Oil advances as US jobs growth adds to supply strains

 Oil eked out a gain on Friday as a forecast-topping US jobs report signaled a strong domestic economy to go along with the supply disruptions squeezing global crude markets.

Futures in New York rose 0.2 percent after unemployment unexpectedly fell to a 49-year low in the US, with cooler-than-projected wage gains.

Crude nonetheless recorded a loss for the week as investors digested a big surge in US production.

“The demand picture has been one possible weak leg for petroleum and this helps to alleviate that concern,” said Kyle Cooper, a consultant at Ion Energy Group in Houston, Texas. “You’ve got minimal-to-moderate inflation with solid growth — that’s your Goldilocks economy.”

West Texas Intermediate crude for June delivery climbed US$0.13 to US$61.94 a barrel at the close of trading on the New York Mercantile Exchange. It finished the week down 2.2 percent, the second straight weekly decline after seven straight gains.

Brent for July settlement rose US$0.10 to US$70.85 a barrel on the London-based ICE Futures Europe exchange. It was down 1.8 percent for the week.

The US hiring numbers accomplished what an attempted coup in Venezuela, tougher sanctions on Iran and disrupted flows from Russia have failed to do in the past few days: push oil markets into positive territory.

Crude’s indifference to the array of threats reflected that world markets appear comfortably supplied for the time being, largely thanks to the ongoing surge in US production, which hit a new record last week.

Prices have also been capped by worries about the global economy, with manufacturing data from China and the US showing that growth remains fragile.

Brent increased 27 percent in the first quarter of this year, its strongest in a decade, on production cutbacks by OPEC and its partners, but lately the rally has lost steam.

“It shows that in an age of OPEC-led production restraint and geopolitical concerns, surging US oil output is more than capable of stunting upward pricing pressures,” said Stephen Brennock, an analyst at PVM Oil Associates Ltd in London.

In OPEC member Venezuela, Venezuelan National Assembly President Juan Guaido on Tuesday launched an uprising against Venezuelan President Nicolas Maduro with the backing of the US government.