Major crude oil benchmarks extended gains after solid jobs data from the U.S. on Friday quelled fears of a potential recession in the U.S. Both Brent crude and WTI crude gained more than 2 percent overnight.
Data released by the U.S. Bureau of Labor Statistics showed the U.S. economy added 253 thousand jobs in April versus 165 thousand in March and expectations of a growth of 180 thousand. Unemployment rate, which was seen rising to 3.6 percent from 3.5 percent in March actually dropped to 3.4 percent. The average hourly earnings which was expected to be steady at 0.3 percent also increased to 0.5 percent.
Markets however shrugged off the possibility of the strong jobs data providing the Fed with more headroom to raise interest rates.
The Fed's recent hints of a pause weakened the Dollar against the basket of 6 currencies. The Dollar Index or DXY lost 0.06 percent and dropped to 101.15, supporting sentiment in the crude oil market.
Brent Oil Futures for July settlement traded between $77.25 and $74.95. It is currently at $76.83, having gained 2.03 percent from the previous close.
West Texas Intermediate Crude Oil Futures for June settlement traded between a high of $73.45 and a low of $71.05. The current price of $73.03 represents a gain of 2.37 percent from the previous close.
On the horizon is trade data from China due on Monday. Data on the crude oil inventory position in the U.S is due to be released by the American Petroleum Institute on Tuesday followed by official data from the Energy Information Agency on Wednesday. Inflation readings from the U.S. as well as China would also be known on Wednesday. The outcome of Bank of England's interest rate review would be known on Thursday.
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