Cape Town: Crude oil edged above $82 a barrel on Friday before a report expected to show US employment declined for a second straight month in July, as investors watch for clues to the pace of economic and energy demand recovery.
The return of crude’s inverse correlation with the US currency is supporting oil, which has recently failed to track stock markets lower, analysts said. European stocks were higher on Friday, helped by some strong earnings.
“We remain stuck near $82 so we still have to wait to see whether we can break higher,” said Carsten Fritsch, analyst at Commerzbank in Frankfurt. “It mainly depends on the US dollar and stock markets.”
US September crude added 15 cents to $82.16 a barrel by 0849 GMT, while ICE Brent eased 16 cents to $81.45.
Financial markets are awaiting US jobs data later in the session. Nonfarm payrolls probably fell by 65,000 in July, a Reuters survey showed ahead of the report.
Oil in New York was on track for its biggest weekly gain in four weeks, up by about 4%, after topping $80 a barrel for the first time in three months on Monday and taking prices out of a persistent $10-wide trading range where they have hovered for almost two months. A weaker dollar makes oil cheaper for holders of other currencies. The dollar was slightly lower against a basket of currencies.
Oil has rallied despite further indications this week that supply remains ample.
The US Energy Information Administration on Wednesday said the country’s gasoline stocks unexpectedly rose, while supplies of distillate fuel including diesel also climbed.
“The fundamentals at some point have to reassert themselves,” said Ben Westmore, a commodities analyst at National Australia Bank in Melbourne.
“We had a pretty weak EIA report. Product stocks are building and the market didn’t react much.”