OIL prices settled above US$106 a barrel yesterday on positive US jobs data and after the government said crude stockpiles grew less than expected last week.
Traders also remain cautious about potential supply problems in the Persian Gulf as Western nations confront Iran over its nuclear program.
Benchmark West Texas Intermediate, which is used to price oil produced in the US, added US$1.46 to end at US$106.16 per barrel in New York. Oil dropped US$2.02 per barrel on Tuesday to a two-week low.
Brent crude, which prices foreign oils that are imported by US refineries, increased by US$1.14 to finish at US$123.12 a barrel in London.
US stock markets and commodities rose more noticeably after The Wall Street Journal reported that Federal Reserve officials are mulling a new form of bond buying that will attempt to boost the US economy without accelerating inflation.
Crude has jumped from US$75 in October because of diplomatic tensions with Iran, a major oil producer, and as US economic indicators including employment have slowly improved over the last few months.
Adding to that optimism yesterday was a report from ADP, a payroll provider, that estimated companies added 216,000 workers last month.
A more reliable read on hiring will come Friday when the government issues its February jobs report. Expectations are high after two strong months of job growth in December and January, a steady decline in unemployment benefit applications and a jump in consumer confidence.
The Energy Department's Energy Information Administration said in its weekly report yesterday that crude supplies grew by 800,000 barrels, or 0.2 percent, to 345.7 million barrels, which is 0.9 percent below year-ago levels.
Analysts expected an increase of 2 million barrels for the week ended March 2, according to Platts, the energy information arm of McGraw-Hill Cos.
The EIA said that US energy demand remains weak. Average petroleum demand has fallen 6.1 percent so far this year and gasoline demand is 7.8 percent lower than a year earlier.
In other energy trading in New York, heating oil added 3.12 cents to finish at US$3.2194 per gallon and gasoline futures rose by 5.75 cents to finish at US$3.2874 per gallon. Natural gas futures fell by 5.4 cents yesterday to US$2.302 per 1,000 cubic feet. That's the lowest price since Feb. 15, 2002, and down 69 cents from the start of the year, as a mild winter comes to a close with a huge surplus of the fuel on hand.
Source:shanghaidaily