(New York) Oil prices rose sharply on Friday, galvanized by the rebound in job creation in the United States in April, dispelling fears of a recession in the country and their consequences on demand for crude.
But crude prices remain on a weekly loss, after plunging throughout the week.
A barrel of Brent North Sea oil for July delivery rose 3.86% to $75.30. It has, however, lost more than 5% since the start of the week.
Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery in June, gained 4.05% to 71.34 dollars, but dropped almost 6% over the week.
The WTI had even bottomed in Thursday’s session at 63.64 dollars, the lowest since the start of the year.
Oil is “benefiting from a technical rebound, after being dragged to March lows by growing fears of a global recession”, said Exinity analyst Han Tan.
For Edward Moya of Oanda, investors “regained their risk appetite after the jobs report showed significant labor market momentum and undermined forecasts of an impending recession.”
Some 253,000 jobs were created in April, the US Department of Labor said on Friday, significantly more than the 180,000 expected by economists.
“The jobs report along with relatively upbeat comments from central bank officials and statements throughout the week suggest there is some hope of avoiding a recession this year” in the United States, says Jameel Ahmad, analyst at CompareBroker.io.
The resilience of job creations despite the drastic increase in U.S. interest rates over the past year “will allow Fed (Federal Reserve) policymakers to be patient and continue to watch the economic data before a new monetary policy decision, according to this analyst.
Recession fears had weighed heavily on prices at the start of the week.
Both the Fed and the European Central Bank (ECB) raised policy rates by 25 basis points on Wednesday and Thursday, adding to concerns that “tighter financial conditions will cause major economies to contract.” John Plassard, analyst for Mirabaud.