Investing.com -- Oil prices wavered on Friday before falling in late trading amid a stronger than expected U.S. employment report.
On the Intercontinental Exchange (ICE), brent crude oil for April delivery dropped 1.02 or 1.67% to close at 59.94 a barrel. Minutes after the U.S. Bureau of Labor Statistics (BLS) released employment data for the month of February in morning trading, brent crude futures edged up 0.7% at $60.90. Earlier in the session, brent crude was up roughly 1% ahead of the data.
The U.S. added 295,000 jobs in February, according to BLS, more than 55,000 above forecasts for the month. Over the last three months, employment growth has reached a monthly average of 288,000, as the current unemployment rate has fallen to 5.5%.
The strong economic data drove the U.S. dollar higher and exacerbated concerns that the Federal Reserve could raise interest rates by June. Federal Reserve Chair Janet Yellen said in testimony last month before Congress that the Fed could consider an interest rate hike on a "meeting by meeting" basis if economic conditions improved and inflation moved toward its target rate of 2%. The Fed could alter its monetary policy stance when the Federal Open Market Committee meets next on Mar. 17-18.
The U.S. Dollar Index, which measures the greenback against a basket of other major currencies, soared 1.36% or 1.31 to 97.71. The euro also reached an 11-year low against the dollar for the third consecutive day, dropping 1.62% or 0.178 to 1.0850.
A stronger dollar affects dollar-denominated commodities like crude making it more expensive for holders of other currencies to purchase the oil futures.
WTI Crude for April delivery dropped 2.86% or 1.49 to $49.27 a barrel. Prices for West Texas Intermediate, alternatively known as Texas light sweet, dropped slightly to $50.57 a barrel shortly after the release of the employment report.
While employment levels were up broadly throughout the nation, the mining sector, which encompasses the energy industry, reported a decline of 9,300 jobs from the previous month. Employment in the Oil & Gas extraction subset fell by 1,100 jobs for the month of February. This comes after 1,900 jobs were lost in Oil & Gas extraction a month earlier.
Prices for WTI and brent crude also dropped slightly after the oil services firm Baker & Hughes released its weekly rig count on Friday afternoon. For the week that ended Feb. 27 oil and gas rigs in the U.S. fell by 75 to 1,192. A week earlier, the rig count dropped by 43 to 1,267.
Elsewhere, tensions in the Middle East remained high. In Northeast Iraq, fighting escalated after militants from the Islamic State set fire to a number of oilfields. In Libya, nearly a dozen oilfields were closed this week amid security concerns.