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Brent crude settled up 13 cents, or 0.2%, at $85.12 a barrel.
West Texas Intermediate U.S. crude closed 9 cents, or 0.1%,
higher at $80.70. There will be no trading on the Good Friday
holiday.
Both benchmarks jumped more than 6% this week after OPEC+, the
Organization of the Petroleum Exporting Countries (OPEC) and
allies including Russia, surprised the market on Sunday with a
pledge of production cuts.
Hedge funds have bought crude all week, moving from the
sidelines back into "risk on" mode, said Dennis Kissler, senior
vice president of trading at BOK Financial.
Prices drew support from a steeper-than-expected drop and a
second consecutive weekly drawdown in U.S. crude inventories
last week. Gasoline and distillate inventories also declined,
hinting at rising demand. [EIA/S]
U.S. energy firms this week also cut the number of oil rigs for
a second week in a row. The rig count, an early indicator of
future output, dropped two to 590 this week, Baker Hughes data
showed. [RIG/U]
Limiting gains, however, U.S. labor market data pointed to
slowing economic growth, and there was also slower-than-expected
growth in the U.S. services sector.
"Demand destruction as function of the threat of recession is
greater than the cut by OPEC+," said Robert Yawger, said
director of energy futures at Mizuho Securities.
Buyers of put options that hedge downside risk were more active
than buyers of call options, which bets on rising prices,
implying traders were worried prices could fall, Yawger added.
"The oil market's bullish momentum may have paused, but upside
potential remains given the tightening supply backdrop," said
Stephen Brennock of oil broker PVM.
(Reporting by Arathy Somasekhar in HoustonAddditional reporting
by Reporting by Alex Lawlerin London, Katya Golubkova in Tokyo
and Muyu Xu in SingaporeEditing by Marguerita Choy and Deepa
Babington)
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