By early afternoon in Europe, benchmark crude for March delivery was up 14 cents at $96.50 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.25 to settle at $96.36 on Thursday.
In London, Brent crude was up 29 cents at $112.36 a barrel on the ICE Futures exchange.
The Labor Department is scheduled to release January employment figures later Friday, data that analysts consider one of the most important measures of economic health. The U.S. created 200,000 jobs in December with an unemployment rate of 8.5 percent, and economists expect about 140,000 jobs were added last month.
The four-week average of unemployment claims fell to 375,750, the lowest since June 2008 and enough to suggest a steadily improving job market, the department said Thursday.
Oil has slid from above $100 last week amid investor concern that rising U.S. crude inventories reflect waning demand.
“While demand has been dismal in Europe as the sovereign debt crisis worsened, demand for oil in the U.S. has also surprised to the downside,” Bank of America Merrill Lynch said in a report. “Despite the apparently better economic data, U.S. oil consumption has been particularly hit by mild winter weather.”
Capital Economics said it expects Brent to fall to $100 by the end of this quarter and to $75 by the end of next year.
Analysts noted the widening gap between the Nymex and Brent contracts, currently almost $16 a barrel.
“As a globally marketed oil type, Brent is benefiting more from the geopolitical uncertainty and the associated supply risks,” said a report from Commerzbank in Frankfurt. “In contrast ... (Nymex) is being depressed by the continuing supply surplus in the U.S. market as reflected in a sharp increase in U.S. stock levels.”
Brent, “the European benchmark crude, is drawing support from a cocktail of oil factors including healthy Asian demand and persistent uncertainty regarding the Iran question,” said a report from JBC Energy in Vienna.
In other energy trading, heating oil was up 1.1 cents at $3.0639 per gallon and gasoline futures gained 1.81 cents to $2.8870 per gallon. Natural gas fell 7.8 cents to $2.476 per 1,000 cubic feet.
