NEW YORK, (Reuters) – Oil prices bounced back on Friday from a torrid 10 percent slide the previous session, as shellshocked traders mulled market fundamentals and the frenzy this week that wiped out half the year’s gains.
Upbeat U.S. jobs data aided the rebound from Thursday’s shock-inducing collapse, when Brent crude fell by as much as $12, a record, in a furious, high volume session that saw waves of selling as key technical levels were broken.
“I think it’s just a little reaction to the way oversold conditions we got into yesterday, it was quite a bloodbath,” Mike Zarembski, senior commodities analyst for optionsXpress in Chicago.
“Traders are still a bit shellshocked from yesterday.”
Concerns about weak economic data from the United States and Europe and the impact of high prices on fuel demand weighed on the markets for most of the week. Volumes remained healthy on Friday, though market participants said some traders were sidelined.
Brent crude traded up $1.60 to $112.40 a barrel at 11:58 a.m. EDT (4:58 p.m. British time). U.S. crude futures gained 67 cents to trade at $100.47 a barrel.
Data from the Labour Department showed U.S. private employers added jobs at the fastest pace in five years in April, pointing to underlying strength in the economy, even as the jobless rate rose to 9.0 percent.
“The jobs data wasn’t so out of kilter that it justified the sell-off or a huge bounce, but investors will want to lighten their load ahead of the weekend if they are on the short side,” said Richard Ilczyszyn senior market strategist at Lind-Waldock in Chicago.
“The market got ahead of itself on the way up and now is bouncing after the sell-off.”