Oil Climbs as Recession Fears Fade

Oil rose on Monday as easing US recession fears shifted market focus to tightening supplies, offering support after crude prices registered three straight weekly declines for the first time since November.
A healthy US jobs report for April helped oil to climb by about 4% on Friday even though labor market strength could compel the Federal Reserve to keep interest rates higher for longer, Reuters reported.
Brent crude was up $1.09, or 1.5%, at $76.39 a barrel. US West Texas Intermediate crude gained $1.03, or 1.4%, to $72.37.
"Oil's rebound follows energy stocks' comeback on Wall Street last Friday after the US reported strong job data, which eased concerns about an imminent economic recession," said CMC Markets analyst Tina Teng.
Brent had finished last week with a decline of about 5.3% while US crude plunged by 7.1% even after Friday's rebound. Both benchmarks were down for three weeks in a row for the first time since November
Ole Hansen, head of commodity strategy at Saxo Bank, said oil's recent drop looked excessive.
"An oversold market condition combined with Brent managing to find support ahead of the March low forced recently established short sellers to seek cover, potentially highlighting that the recent sell-off was overdone," he said.