Nov. 3 (UPI) — Steady improvements in the U.S. labor market, coupled with militant threats against a major OPEC producer, helped support a soft rally in oil prices Friday.
The U.S. Labor Department reported Friday that total non-farm payrolls jumped 261,000 last month, with food services and restaurant employment offsetting any of the declines that came as a result of Hurricanes Irma and Harvey. That beats the estimate early this week from payroll processor ADP, which reported private-sector employment increased by 235,000 from September to October
The federal government added that those employed part-time because of economic reasons declined by 369,000 in October, another indication of post-hurricane resilience.
More jobs means growing demand for energy products, something traders are watching for in oil and consumer fuels. U.S. levels of oil and gasoline held in storage have been on a steady decline for most of the quarter, indicating demand is drawing somewhat on the surplus for the five-year average for global crude oil inventories.
After a wobbly session Thursday, crude oil prices returned to a rally that’s extended for nearly a month. The price for Brent crude oil was up 0.58 percent at 9:20 a.m. EDT to $60.97 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was up 0.4 percent to $54.76 per barrel.
Gains were supported elsewhere by a return to action from the Niger Delta Avengers, a militant group that last year claimed several attacks on infrastructure in the oil-rich Niger Delta.
“Our next line of operation will not be like the 2016 campaign which we operated successfully without any casualties,” spokesman Murdoch Agbinibo said in a statement. “This outing will be brutish, brutal and bloody.”
Nigeria is a member of the Organization of Petroleum Exporting Countries, but is exempt from the OPEC-led effort to balance the oversupplied market with coordinated production cuts. The Nigerian government lobbied for an exemption so it could steer oil revenue toward national security efforts.
Nigeria’s stance on the agreement matters as OPEC-ministers will consider extending the production agreement deep into 2018 during meetings later this month in Vienna.
Elsewhere, U.S. labor figures may paint a mixed picture on economic momentum. Restaurant workers made up the bulk of the job gains, with industries like construction and mining showing little change in October.
The average workweek for all sectors remains relatively unchanged, though those in the manufacturing sector were logging more in overtime. Wages, however, slipped in October by 1 cent per hour, after rising 12 cents in September.