Oil extends earnings, supported by surprising report on US jobs

TOKYO (Reuters) – Crude prices rose on Monday, bolstering gains in the previous session on better than expected US employment data, although the gains were tempered by long-term concerns. trade war between Canada and the United States.

Brent futures contracts, LCOc1, increased 10 cents, or 0.2%, from 00:48 GMT to $ 64.33. WTC (US West Texas Intermediate) CLc1 rose 14 cents, or 0.2%, to $ 57.65 per barrel.

"A very cautious opening this morning backed by better than expected (non-farm payroll)," said Stephen Innes, managing partner at Vanguard Markets in Bangkok. "Traders remain incredibly cautious about the weaker global economic overhang."

Both oil indicators fell last week, with worries over the slowdown in the global economy outweighing the risks badociated with supply. Brent fell by more than 3% and WTI by more than 1.5%.

US job growth rebounded sharply in June, as the government's payroll rose, a tightly monitored employment report said Friday, suggesting that the sharp slowdown in hiring in May was likely to be punctual.

Employers added 224,000 jobs last month, the highest number in five months, the report said.

But the US-China trade war has weakened prospects for global economic growth and oil demand.

The lack of concrete progress in resolving the acrimonious trade war between the United States and China, however, means that the bar could be very difficult for the US Federal Reserve not to reduce its borrowing costs at its political meeting July 30th and 31st.

White House economic adviser Larry Kudlow confirmed that senior officials from the United States and China will meet in the coming week to continue trade negotiations.

Still, Japanese core machinery orders fell for the first time in May, the biggest monthly drop in eight months, a worrying sign that global trade tensions are weighing heavily on business investment.

Oil received support because of latent tensions on Iran and after an extension last week of cuts in production from OPEC and its allies.