NEW YORK: Oil prices fell on Friday after a weaker than expected US jobs report indicated a patchy economic recovery that could mean slower fuel demand during a resurgent pandemic.
Losses were capped by concerns that US supply would remain limited in the wake of Hurricane Ida, which cut production from the U.S. Gulf of Mexico, report agencies.
Both benchmark oil contracts were largely steady for the week, with US crude up 0.80 per cent.
“Prices slipped on the employment report, which was clearly impacted by the Delta variant,” said John Kilduff, a partner at Again Capital in New York. “This was a reality check that the coronavirus is still impacting demand,” he added.
Non-farm payrolls missed expectations with an increase of 235,000 jobs amid a softening in demand for services and persistent worker shortages as Covid-19 infections soared. Economists polled by Reuters had forecast non-farm payrolls would increase by 728,000 jobs.
Meanwhile oil and gas production in the US Gulf of Mexico remained largely halted in the aftermath of Hurricane Ida, with 1.7 million barrels, or 93 per cent, of daily crude output suspended, according to offshore regulator the Bureau of Safety and Environmental Enforcement.