Oil prices at $83 per barrel on jobs increase

October 7, 2011 - 2:25 PM

NEW YORK (AP) — Oil prices climbed to near $83 per barrel Friday as a volatile week for crude ended with news of a burst of hiring in the U.S.

Prices have recovered from 12-month lows, yet traders say they're not sure where the market is headed following a series of mixed bag of economic news this week. The government said that employers added more jobs than expected last month, yet it wasn't enough to lower the unemployment rate. Consumers bought more merchandise, but only because retailers offered discounts. And even though Europe took steps to bolster its struggling banks, credit ratings agency Fitch downgraded Italy and Spain because of their big debt loads.

"The market is clearly confused," analyst and trader Stephen Schork said. "You just can't make any conclusive opinions about where prices are going."

Oil prices have been up and down all week. On Tuesday benchmark oil finished at $75.67 a barrel. That's the lowest it's been since September, 2010. On Friday it was up 39 cents to end at $82.98 a barrel.

Oil got a boost Friday after the Labor Department announced that the U.S. added 103,000 jobs in September. The government also said that the country added more jobs than previously estimated in July and August.

More jobs means gasoline demand could rise in coming months as more drivers return to the daily commute.

Last month's jobs gains were propped up by 45,000 Verizon workers rehired after going on strike. The nation's unemployment rate remains at 9.1 percent, and the economy needs to add 125,000 jobs a month to keep up with population growth and to start to bring down the jobless rate.

At the pump, gasoline prices held steady at a national average of $3.392 per gallon, according to AAA, Wright Express and Oil Price Information Service. Gasoline has dropped almost every day for a month, but it's still about 62 cents higher than a year ago.

In other energy commodities trading, heating oil was essentially flat, finishing at $2.8588 per gallon and gasoline futures fell 3.84 cents to end at $2.6476 per gallon. Natural gas lost 11.7 cents to finish the day at $3.481 per 1,000 cubic feet.

Brent crude rose 15 cents to finish the day at $105.88 in London.