The price of oil moved up closer to $102 a barrel Friday as markets were optimistic about an upcoming report on U.S. hiring and amid concerns that the Egyptian crisis might affect Mideast supplies.
By early afternoon in Europe, benchmark crude for August delivery was up 54 cents to $101.78 a barrel in electronic trading on the New York Mercantile Exchange. Nymex floor trading was closed Thursday for the Independence Day holiday.
On Wednesday, the contract gained $1.64 to $101.24, its highest close since early May last year, propelled by political unrest in Egypt and a sharp drop in U.S. oil supplies that could signal stronger demand.
On Wednesday, the military ousted Egypt's first freely elected president, Mohammed Morsi of the Muslim Brotherhood. On Friday, the Islamist group began a series of protests and attacks against the removal of Morsi, who has been replaced by Adly Mansour, the head of the Supreme Constitutional Court, until new elections are held.
Egypt is not an oil-producer but its control of the Suez Canal, one of the world's busiest shipping lanes, gives it a crucial role in maintaining global energy supplies. "More than 2 million barrels of crude oil are transported each day through the Suez Canal and the neighboring Sumed pipeline," said analysts at Commerzbank in Frankfurt. "Despite all the concerns about supply outages, there is currently no tightness of supply on the oil market."
The U.S. jobs report could be crucial to whether oil continues to rise or cedes recent gains as it will provide insight into the strength of the recovery in the world's No. 1 economy and a major crude consumer. A survey of analysts by FactSet forecasts that 178,000 new jobs were created in June.
"Crude markets have benefited from stronger U.S. data in recent weeks, which has supported an improving demand driven outlook for stronger prices," said a report from Sucden Financial Research in London, which expected any drops to below $100 to be quickly reversed until the political situation in Egypt is stabilized.
Brent crude, which is used to set prices for oils used by many U.S. refineries, was up 39 cents to $106.15 on the ICE exchange in London. In other energy futures trading on Nymex: — Wholesale gasoline was up 0.94 cent at $2.8476 per gallon.
— Natural gas fell 2.3 cents to $3.667 per 1,000 cubic feet. — Heating oil added 0.78 cent to $2.959 a gallon.