Oil futures rallied on Tuesday and U.S. crude approached 2015 highs on strong jobs data and government forecasts for lower U.S. crude production growth and higher global demand for oil.
U.S. job openings surged to a 14-year high in February the Labor Department’s monthly Job Openings and Labor Turnover Survey (JOLTS) said, helping erase oil’s early losses.
“That JOLTS report was certainly quite strong and strong employment equals strong gasoline demand,” said John Kilduff, partner at Again Capital LLC in New York.
An Energy Information Administration (EIA) monthly report raising forecasts for U.S. and global demand growth and lowering forecasts for crude oil production growth in the United States also was supportive.
U.S. May crude rose $1.84 to settle at $53.98 a barrel after dropping to $51.17. The $54.13 peak was the highest since reaching $54.15 on Feb. 17. Prices hit $54.24 on Feb. 3 and the 2015 peak was $55.11 on Jan. 2.
Brent May crude rose 98 cents to settle at $59.10, having swung from $57.02 to $59.27, highest since March 26.
U.S. and Brent futures pared gains sharply in post-settlement trading after data from industry group American Petroleum Institute (API) showed crude stocks rose 12.2 million barrels last week.
Expectations were only for inventories to be up 3.4 million barrels in a survey taken ahead of the report.
U.S. RBOB gasoline futures turned lower after settling nearly two cents higher when the API said gasoline stocks rose 2.7 million barrels against a forecast for a 1.0 million barrel drop.
The EIA’s weekly inventory report will be released at 10:30 a.m. EDT on Wednesday.
Saudi Arabia’s Oil Minister Ali al-Naimi reiterated that the kingdom and the Organization of the Petroleum Exporting Countries were ready to help “improve” oil prices with help from other producer countries.
“Naimi saying again his comment about being ready to act if other producers cooperate added to two days of bullishness,” said Dominick Chirichella, senior partner at Energy Management Institute in New York.
Prices also got a lift from news that Minneapolis Fed President Narayana Kocherlakota made a case for waiting until the second half of 2016 to raise interest rates.
Crude futures recovered after slipping earlier Tuesday on signs of growing oversupply as Iranian officials visited China to seek more oil sales following the framework nuclear deal that could lead to lifting sanctions on Tehran.