By Rowena Edwards
LONDON (Reuters) -Oil prices rose by over $1 on Friday, boosted by a weaker dollar that dipped on a U.S. jobs report.
Brent crude futures rose $1.13, or 1.44%, to $79.82 a barrel by 1442 GMT.
U.S. West Texas Intermediate crude futures were up $1.07, or 1.45%, at $74.74.
The dollar pared earlier gains after U.S. jobs data for December showed that employers added 223,000 jobs in the month, more than economists’ forecasts, while wage growth was slightly less than expected.
The data may reduce the odds that the Federal Reserve will hike interest rates by another 50 basis points next month.
A weaker dollar can boost demand for oil, as dollar-denominated commodities become cheaper for holders of other currencies.
Price support also followed news that China, the world’s largest crude oil importer, expects passenger traffic by road, rail, water and air during the coming Lunar New Year holidays to double from the same period in 2022.
China, the economy of which has been hit by another COVID wave, also announced more state support measures on Thursday.
Further bullish sentiment came from a higher-than-expected fall in U.S. distillate inventories in the week to Dec. 30, according to data from the Energy Information Administration (EIA) on Thursday. [EIA/S]
On a weekly basis, however, both the Brent and WTI contracts were on track to fall by around 7% from the previous week, pressured by concern over the possibility of a global recession.
“The oil market might be regaining some composure following the bloodbath earlier this week, but the upside potential remains limited, at least in the near term. The economic outlook is clouded,” PVM analyst Stephen Brennock said.
The world’s top crude exporter, Saudi Arabia, lowered prices for the Arab light crude it sells to Asia to its lowest since November 2021 amid the global pressures hitting oil.
(Reporting by Rowena Edwards; Additional reporting by Emily Chow in Singapore; Editing by David Goodman and Mark Porter)
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