Iran Seeking Vengeance On Israel Boosts Oil, Weekly Gain Exceeds 4%

Meanwhile, huge U.S. job increase is good for demand, bad for rate cuts: File Image/Oixabay.

Sabre rattling from Iran was said to have contributed to Friday's modest rise in oil prices, while signs of a robust U.S. economy stoked concerns that central banks would continue to delay lowering interest rates. 

Brent settled up 52 cents at $91.17 per barrel, while West Texas Intermediate settled up 32 cents at $86.91 per barrel; both benchmarks were on track for a weekly rise of over 4 percent.

Analysts on Friday debated what course of retaliation Iran could take for an Israel strike in Damascus on Monday that killed two of its generals and five military advisors; but they agreed that any retaliation had the potential to broaden hostilities in the Middle East - and disrupt crude movement.

Meanwhile, U.S. officials were reportedly on alert to see if Iran-backed proxies would attack American. troops in Iraq and Syria.

Bjarne Schieldrop, chief commodities analyst at SEB AB, said, "The market now knows that some kind of retaliation from Iran will likely come — but it doesn't know when and where and what — and that creates a great discomfort and nervousness."

Meanwhile, government data revealed that U.S. job growth soared far higher than expected in March amid a steady increase in wages; however, analysts worried that the 303,000 job gain, which bolstered oil demand, could also delay interest rate cuts by the U.S. Federal Reserve later this year.

In other oil news on Friday, Bloomberg maintained its stance that despite choppy trading, the global oil market "has gone from languid to lively in the space of a few weeks," driven by supply constraints and robust demand.

The news agency also noted that "The spread between the nearest two December contracts, a favored trade for speculators, is back to the widest since October; that represents increasing confidence in a tight market, something that's also supported by firmness in pricing signals at the key U.S. hub in Cushing, Oklahoma."

For its part, JPMorgan Chase & Co. said Brent has a chance to reach $100 per barrel this year if Russia's decision to cut production isn't balanced out by other measures.