Futures in New York rose as much as 0.6 percent after adding 2.5 percent in the past three sessions. An industry report showed U.S. inventories fell last week, with government data Wednesday forecast to show a fourth straight drop. Crude’s recent gains have been driven by fighting between the Iraqi government and Kurdish forces in the oil-rich Kirkuk region, which could stoke tensions beyond the country’s borders. Iraq is just one of the oil market’s geopolitical risks, with uncertainty also growing over tensions between Iran and the U.S., Goldman Sachs Group Inc. said Tuesday. The Persian Gulf nation said it would support an extension of OPEC output cuts to the end of 2018 and insisted its production plans won’t be disrupted by U.S. President Donald Trump’s disavowal of the nuclear deal that’s boosted its exports. Click Read More below for additional information.
The U.S. jobs report topped estimates last week, increasing confidence in the world’s biggest economy, giving a boost to the outlook for energy demand and driving benchmark crude prices up 3.2 percent on Friday. American oil explorers idled four rigs last week after six consecutive increases in drilling, easing fears over surging shale production. Prices were 0.4 percent lower Monday.
“Employment is the key driver of oil demand, as more people at work means more commutes and, in consequence, rising road fuel use,” said Norbert Ruecker, head of commodity research at Julius Baer Ltd. in Zurich.
American explorers cut the number of rigs drilling for oil by four, the first decline since mid-January, Baker Hughes data showed Friday. That followed government data showing the U.S. added 313,000 jobs in February, the biggest increase since July 2016 and more than the median estimate of 205,000 new positions.
Still, fears over increasing U.S. production continue to weigh on producers and investors. Iran wants OPEC to work to keep oil prices at about $60 a barrel as an increase toward $70 will encourage shale oil output, the country’s Oil Minister Bijan Zanganeh said, the Wall Street Journal reported.
more at: https://www.bloomberg.com/news/articles/2018-03-12/oil-holds-gain-as-u-s-drilling-eases-for-first-time-in-7-weeks