Oil Prices Rebound as Iran Deal Hopes Offset Job Loss Worries

Oil prices rose on Friday as investors weighed the potential deal between Iran and Gulf states to end the five-month conflict. Brent crude futures climbed 84 US cents, or 1.02 per cent, to US$83.33 a barrel, while West Texas Intermediate futures increased 89 US cents, or 1.15 per cent, to US$78.18.

The market's focus shifted from the potential deal to the U.S. job losses reported by the federal government. The economy lost 23,000 jobs in July, which analysts said means there's less likely to be intervention by the Federal Reserve to raise interest rates.

Iran is seeking fees of between 5 per cent and 7 per cent of the price of cargoes from ships using the Strait of Hormuz, while Oman is discussing fees of about 3 per cent. The proposed deal is not easily workable due to U.S. sanctions and restrictive insurance clauses on any payments.

Saudi Arabia expects imminent coordinated attacks from Iraqi militias north of the Gulf state and from Yemen's Houthis from the south under the supervision of Iran's Islamic Revolutionary Guard Corps.