Oil rallies on short-term easing in U.S. unemployment

NEW YORK, July 7 (UPI) -- Despite underlying economic and supply-side pressures, crude oil prices rallied in early Thursday trading in response to positive U.S. labor news.

The U.S. Labor Department said weekly first-time claims for unemployment dropped 16,000 from the previous week. The less-volatile four-week moving average was down 2,500, though first-time claims from the previous weekly report moved higher by 500 to 266,750.

"This marks 70 consecutive weeks of initial claims below 300,000, the longest streak since 1973," the Labor Department said in a statement.

The U.S. momentum follows weeks of concerns triggered by the British vote in June to leave the European Union. A statement from British Chancellor of the Exchequer George Osborne, Goldman Sachs Vice Chairman Michael Sherwood, and others, sought to assure investors work was underway to maintain a solid financial position in the global marketplace.

"Britain's decision to leave the EU clearly presents economic challenges which we are determined to work together to meet," their statement read.

Crude oil prices moved higher in early Thursday trading. The price for Brent crude oil moved up 1.3 percent to $49.45 per barrel. West Texas Intermediate, the U.S. benchmark for crude oil prices, gained 1.4 percent to start the day in New York at $48.13 per barrel.

The rally comes despite movements favoring supply-side pressures in crude oil. Norwegian mediators said Thursday a strike was averted because of wage concessions, sparing about 6 percent of the nation's total oil and gas production. Speaking by phone to the news agency Bloomberg, a commander in charge of Libyan oil security said Thursday crude oil exports from two of the country's largest ports, opened only sparingly since civil war in 2014, could resume within a week.

Oil prices moved briefly above $50 per barrel earlier this year because of shortages in supply triggered in part by outages caused by wildfires in Canada.

Crude oil prices moved more or less in parallel with global stock markets Wednesday, erasing losses early in the session after brighter economic data overshadowed lingering concerns about the so-called Brexit. Nevertheless, governors from the U.S. Federal Reserve warned in recently published meeting minutes the British referendum could have a lasting impact on the U.S. and global economy.

"Most participants noted that the upcoming British referendum on membership in the European Union could generate financial market turbulence that could adversely affect domestic economic performance."