Investing.com - Crude oil prices rose in Asia on Friday even as the prospect of more oil from Iran hitting the market appeared likely after Western powers negotiated a tentative nuclear deal with Tehran.
On the New York Mercantile Exchange, crude oil for May delivery rose 0.24% to trade at $49.53 a barrel.
Trade was thin on holidays in many markets, including the U.S., but non-farm payroll data will be released.
Overnight, oil futures tumbled on Thursday, as investors looked awaited the outcome of discussions between western diplomats and Iran over Teheran's disputed nuclear program.
On late Thursday, details emerged that Iran and Western powers had reached a deal on the framework of a preliminary Iranian nuclear pact before a final agreement could be reached in late-June.
"This framework would cut off the pathway Iran could take to develop a nuclear weapon," U.S. president Barack Obama said at a news conference outside the White House. "This deal is not based on trust, it is based on unprecedented verification."
It is believed that the severe economic and financial sanctions against the Persian Gulf nation will be lifted on a staggered, step-by-step basis depending on how cooperative it is with inspectors from the International Atomic Energy Agency. Sanctions that have limited the Iranian Banking System will be among the limitations that could be initially removed, NBC News reported.
"The European Union will terminate the implementation of all economic and financial sanction and the U.S. will cease the application of all economic and financial sanctions," EU Vice President Federica Mogherini said at a joint news conference with Iran.
On the ICE Futures Exchange in London, Brent oil for May delivery slumped $1.52, or 2.67%, to trade at $55.58 a barrel on Thursday.
The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories rose by 4.8 million barrels in the week ended March 27, below the 5.2 million barrel build reported by the American Petroleum Institute.
The data showed that U.S. crude output declined for the first time since late-December, fuelling speculation that an ongoing collapse in rigs drilling for oil will finally result in lower production.
According to industry research group Baker Hughes (NYSE:NYSE:BHI), the number of rigs drilling for oil in the U.S. stood at 813 last week, the lowest since March 2011.
Market players have been paying close attention to the shrinking rig count in recent months for signs it will eventually reduce the glut of crude flowing into the market.
Oil prices have fallen sharply in recent months as the Organization of Petroleum Exporting Countries resisted calls to cut output, while the U.S. pumped at the fastest pace in more than three decades, creating a glut in global supplies.
Investors focused on Friday’s U.S. employment report, which was forecast to show a gain of 245,000 jobs in March, following an increase of 295,000 in February.
The U.S. Department of Labor said earlier that the number of individuals filing for initial jobless benefits declined by 20,000 last week to 268,000 from the previous week’s total of 288,000. Analysts had expected initial jobless claims to fall by 3,000 to 285,000 last week.
A separate report showed that the U.S. trade deficit widened narrowed 16.9% in February to $34.44 billion, the lowest level since 2009.
On Wednesday, payroll processing firm ADP said non-farm private employment rose by 189,000 last month, below expectations for an increase of 225,000 and the lowest since January 2014.
The disappointing data fuelled concerns over the health of the U.S. economy and dampened expectations for higher interest rates.