Oil headed for a weekly gain on signs that the U.S. economic recovery is gaining momentum and concern that tensions with Iran may lead to a disruption in Middle Eastern exports.
West Texas Intermediate futures have advanced 3.4 percent this week. Hiring in the U.S. accelerated in December for a second month, pointing to a strengthening labour market heading into 2012. The European Union is working to halt oil purchases from Iran. European foreign ministers aim to announce harsher penalties on the Persian Gulf nation’s energy and banking industries at a meeting Jan. 30, according to a EU spokesman. The Geopolitical situation is impacted by the statements that Iran has threatened to close the Strait of Hormuz, which would have an immense effect on the global oil market.
Crude for February delivery was at $102.23, at 13.30 London Time on Friday 06th January 2012 minutes after the release of Nonfarm Payroll report in US. Prices gained 8.2 percent in 2011. Brent oil for February settlement on the London-based ICE Futures Europe exchange traded at $113.02 a barrel. The European benchmark contract was at a $10.79 premium to New York-traded West Texas Intermediate crude. The spread was a record $27.88 on Oct. 14.