Forexpros – Crude oil futures held on to sharp gains on Thursday, as growing concerns over a disruption to Nigerian oil supplies and a broadly weaker U.S. dollar countered downbeat data on U.S. jobless claims and retail sales.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in February traded at USD102.59 a barrel during early U.S. morning trade, rallying 1.7%.
It earlier rose by as much as 1.98% to trade at a two-day high of USD102.95 a barrel.
Oil prices largely shrugged off a report showing that retail sales in the U.S. rose at the weakest pace in seven months in December, while core retail sales declined unexpectedly.
Separate data showed that the number of people who filed for unemployment assistance in the U.S. last week rose to the highest level since late November.
The downbeat data dampened optimism over the economic outlook of the world’s largest crude consumer.
However, prices continued to draw support from concerns over a disruption to supplies from Nigeria after the country’s oil union threatened to shut down all production starting Sunday if the government did not reinstate a fuel subsidy, which more than doubled the price of gasoline in the past week.
Nigeria produces approximately 2.0 million barrels of oil per day, making it Africa’s largest oil producer.
Oil traders also monitored ongoing tensions between Iran and the West after Japan’s finance minister Jun Azumi said earlier that Japan was to ready to steadily reduce oil imports from Iran in support of U.S. sanctions on Tehran.
Prices drew additional support as risk sentiment improved after European Central Bank President Mario Draghi said that there are “tentative” signs that the economy in the euro zone is stabilizing. The comments came after the ECB left the benchmark interest rate unchanged at 1.0%.
Also Thursday, Spain sold twice the maximum targeted amount of EUR5 billion at auction at lower yields than in similar offerings in December. An auction of Italian short-term government debt also met with solid investor demand at sharply lower yields.
The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was down 0.47% to trade at 81.19.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for February delivery surged 2.12% to trade at USD114.63 a barrel, with the spread between the Brent and crude contracts standing at USD12.04 a barrel.
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