Crude oil futures rose during the Asian session on Friday after falling to a three-week low on Thursday over disappointing U.S. unemployment figures and hopes over extra supply from Libya.
Libya’s National Oil Corp expects to start production from country’s largest oil fields, El Sharara in next few days as protestors agreed to end a two-month-old stoppage of the facility.
Trading volumes are expected to remain light due to the holiday period, reducing liquidity in the market and increasing volatility, which can help exaggerate market moves. Japanese markets remained closed on Friday for New Year’s holiday.
On the New York Mercantile Exchange, West Texas Intermediate crude for delivery in February traded at USD95.60 a barrel during Asian morning trade, up 0.16%.
Earlier on Thursday, New York-traded oil futures fell by as much as 1.5% to hit a session low of USD96.94 a barrel, the weakest since December 16.
NYMEX oil futures were likely to find support at USD96.53 a barrel, the low from Dec. 16 and resistance at USD99.38 a barrel, the high from Dec. 31.
The U.S. Department of Labor said in a report earlier that the number of individuals filing for initial jobless benefits declined by 2,000 to a seasonally adjusted 339,000 last week. Analysts had expected U.S. jobless claims to fall by 7,000 to 334,000 from the previous week’s revised total of 341,000.
Oil prices also weakened on Thursday due to a broadly stronger U.S. dollar, as dollar-priced commodities become more expensive to investors holding other currencies when the greenback gains.
On Friday, the dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was trading flat at 80.71.
Oil traders now looked ahead to key U.S. weekly supply data, which was forecast to show a fifth consecutive weekly drop in crude stockpiles.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories fell by 5.7 million barrels in the week ended Dec. 27. The more closely-watched numbers from the U.S. Energy Information Administration have been delayed until Friday due to the New Year’s holiday.
U.S. crude futures, also known as West Texas Intermediate or WTI, have been well-supported in recent months amid indications the U.S. economy is gaining momentum.
NYMEX oil prices ended 2013 with a gain of approximately 6%, the biggest annual advance since 2010.
Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for February delivery dropped 0.25% to trade at USD108.02 a barrel, while the spread between the Brent and U.S. crude contracts stood at USD12.42 a barrel
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