Oil headed for a weekly gain in New York on signs that the U.S. economic recovery is gaining momentum and concern that tensions with Iran may lead to a disruption in Middle East exports.
West Texas Intermediate futures have advanced 3.4 percent this week. Hiring in the U.S. probably accelerated in December for a second month, pointing to a strengthening labor market heading into 2012, economists said before a report today. The European Union is working to halt oil purchases from Iran, said Victoria Nuland, a U.S. State Department spokeswoman. European foreign ministers aim to announce harsher penalties on the Persian Gulf nation’s energy and banking industries at a meeting Jan. 30, according to EU spokesman Michael Mann.
“The recent string of better-than-expected macroeconomic indicators from the U.S. has rebuilt some of the optimism and risk appetite,” said Thina Saltvedt, an analyst at Nordea Bank AB in Oslo. “Iran has threatened to close the Strait of Hormuz, which would have an immense effect on the global oil market.”
Crude for February delivery was at $102.21, up 40 cents, at 11:05 a.m. London time. Yesterday, the contract fell $1.41 to $101.81, the lowest settlement this week. Prices gained 8.2 percent in 2011.
Brent oil for February settlement on the London-based ICE Futures Europe exchange rose 52 cents, or 0.5 percent, to $111.26 a barrel. The European benchmark contract was at a $11.05 premium to New York-traded West Texas Intermediate crude.