Improvements in US Economic Data Results to Recent Oil Price Increase

Oil prices recently increased in Asian trade with data manifesting better employment figures in the United States as worries regarding West Asia’s geopolitical tensions remained.

New York’s primary benchmark West Texas Intermediate crude prices for May delivery rose by 33 cents to reach $105.68 barrel. Meanwhile, prices for Brent North Sea oil for May delivery increased by 12 cents to end at $123.26.

Japan’s Newedge brokerage energy desk manager, Mr. Ken Hasegawa, said that oil prices have increased with the positive outlook of the U.S. economy and concerns regarding Iranian oil supply.

A recently released piece of U.S government data showed that unemployment benefit claims decreased to a level not seen in four years, which shows that the depressed labor industry of the country is slightly recovering.

According to the Labor Department of the United States, the number of filed unemployment claims was around 384,000 as of the March 17 week. That figure is lower than the 353,000 claims posted during the week before that.

In the early parts of the month, data showed strong job creation in February, marking the third month of gains, even if the unemployment rate of 8.3% remained from the month of January as people seeking for work in the largest economy of the world increased.

According to analysts, the conflict between Iran and the West stays as a major factor impacting crude oil prices.

Iran has threatened to close the Hormuz Strait, a passageway for 20% of the oil supply worldwide, in case the West imposes more economic sanctions for its alleged nuclear program.

The majority of the international community thinks that the nuclear program of Iran is aimed at creating a nuclear weapon. However, Tehran does not admit to the charges as it claims that the project’s purpose is to generate power and for medical reasons.

By Chris Termeer