NYMEX WTI Futures Gain on US Jobs Data

WASHINGTON, D.C. (DTN) -- Nearest delivered New York Mercantile Exchange oil futures and Brent crude on the Intercontinental Exchange mostly edged higher Friday afternoon. West Texas Intermediate and Brent posting 2% declines on the week, as strong U.S. economic data was countered by a larger-than-expected build in U.S. crude inventories.

NYMEX June WTI futures edged up $0.13 to settle at $61.94 bbl, while ICE July Brent gained $0.10 with $70.85 bbl settlement. NYMEX June ULSD futures moved 0.76cts down to $2.0702 gallon, while June RBOB futures gained 0.82cts to $2.0265 a gallon.

Oil futures were boosted Friday after U.S. Bureau of Labor Statistics reported 263,000 new jobs were added in the United States last month, well above expectations for 185,000 new hires. Federal data also showed the unemployment rate declined to 3.6%, the lowest in nearly 50 years, easing demand concerns for the world's largest economy. Latest employment report also revised higher the total nonfarm payroll jobs for February, lifting net job gains for February and March by 16,000 from the previous report, while job gains averaged 169,000 per month over the last three months.

WTI's upside was limited on Friday by a larger-than-expected 9.9 million bbl build in U.S. commercial crude inventories reported midweek by Energy Information Administration. Oil supply in the United States reached a 19-month high during the last week of April amid record 12.3 million bpd output, indicating domestic oil market might not be as tight as previously estimated. Baker Hughes reported on Friday the number of oil rigs deployed in the United States also edged up two this week after a 28-rig plunge over the previous two weeks that pressed the count to a 13-month low. Oil companies operating in the United States have removed 78 rigs from the field year to date, while down nine in the second quarter and 27 against year prior.

In contrast with surging U.S. production, Organization of the Petroleum Exporting Countries' output reached a four-year low level in April, driven by involuntary losses from Venezuela and Iran. Reuters' survey showed this week the 14-member group of oil producers pumped 30.23 million bpd with Saudi Arabia and Gulf allies maintaining larger supply cuts than previously agreed in the Vienna accord. In April, OPEC+ agreement achieved 132% compliance with pledged cuts compared to 145% in March, due to higher output in Nigeria and Iraq.

Federal Open Market Committee announced this week interest rates would remain unchanged in the range between 2.25% and 2.5%, triggering midweek declines across equity markets. Dow Jones Industrial recovered 197 points on Friday to 26,504.95, while S&P 500 advanced 0.96% to finish volatile trading week. U.S. Dollar weakened to a 97.260 better than two-week low in spot index trading, providing support for WTI.

Liubov Georges can be reached at liubov.georges@dtn.com