By Robert Harvey
LONDON (Reuters) – Oil prices steadied on Friday as investors digested fresh U.S. employment data, in the quest for clues as to whether interest rate cuts may occur in the United States and Europe in the first half of this year.
Brent crude futures were down a marginal 0.13%, or 11 cents, at $82.85 a barrel by 1410 GMT. U.S. West Texas Intermediate crude futures were down 0.18%, or 14 cents, at $78.79.
U.S. job growth rose by 275,000 new nonfarm payrolls in February, according to the Bureau of Labor Statistics, beating expectations of a 200,000 rise according to a Reuters survey.
The unemployment rate also rose and wage growth decelerated, indicating that the U.S. economy could be slowing which kept on the table an anticipated interest rate cut in June from the Federal Reserve.
The data suggests “a less tight job market, supporting the soft landing narrative and increasing the odds of a June rate cut,” UBS analyst Giovanni Staunovo said.
Oil markets have homed in on signals on the timing of possible rate cuts in the United States and European Union in the previous two sessions.
Lower interest rates could increase oil demand by boosting economic growth.
The European Central Bank (ECB) will likely start lowering interest rates some time between April and June, French central bank head and ECB policymaker Francois Villeroy de Galhau said on Friday.
U.S. Federal Reserve Chair Jerome Powell said on Thursday that the central bank was “not far” from gaining enough confidence that inflation is falling sufficiently to begin cutting interest rates.
Both benchmarks are heading for a loss on the week, with Brent set for a 0.8% drop from last Friday and WTI down by 1.5%, although both have been range bound over the last month, between $81.50 and $84 for Brent, and $76-80 for WTI.
“Oil markets have stayed relatively flat over the past couple of weeks despite strong rallies and some all-time highs across equities, gold, bitcoin and bonds,” Investec Head of Commodities Callum Macpherson said.
(Reporting by Robert Harvey in London, Katya Golubkova in Tokyo and Emily Chow in Singapore; Editing by Emelia Sithole-Matarise, Kirsten Donovan and Frances Kerry)
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