Crude Heads For Second Weekly Gain On Strong US Data

Crude oil is heading for its second weekly advance, amid hopes the U.S. economy will be able to cope with the tax hikes and spending cuts that will kick-in this year, brightening the outlook oil demand.

These hopes were triggered by the strong job data from the United States. The number new claims for unemployment benefits filled last week dropped for a third straight week, indicating the labor market recovery is improving.

Optimism was also supported by Japan’s approval on Prime Minister Shinzo Abe`s “dream team” at the helm of Japan’s central bank. Haruhiko Kuroda, a supporter of aggressive stimulus, is the next governor, improving the outlook for oil demand from Japan.

- Crude oil is trading as of this writing around the $93.20 a barrel level, compared with the opening at $93.22, while the highest is at $93.34 and the lowest is at $93.07

- Brent is trading as of this writing around the $109.22 a barrel after rising 0.24%

However, some downside pressures may arise from OPEC’s decision to “increase daily crude exports by 300,000 barrels to 23.75 million in the four weeks to March 30 as refineries in Europe and the U.S. resume after maintenance and boost demand”.

Also weighing on oil prices on Friday, is the restart of oil production from South Sudan, which means that supplies will be abundant. It’s been over a year since the new nation shut down its oil industry.

Focus will turn today to the EU leaders, who are holding a second day of summit meetings in Brussels,. The eurozone will release its CPI, Spain will release its general government debt while the U.S. will release its industrial production, CPI and confidence data.

- Natural gas is trading as of this writing at $3.845 per cubic feet after rising 0.87%

- Heating oil is trading at $2.9323 a gallon after rising 0.10%

- Gasoline is trading as of this writing at $3.1417 a gallon after rising 0.01%