Crude Oil Soars Over 6% To End At A One-Month High

(RTTNews) - U.S. crude oil surged to end at a one-month high on Monday, with investors seeing no immediate oversupply threats as it could take several months for Iran to ramp up crude oil production for export, following a deal with western powers over its nuclear program.

Tehran reached a broad deal with the West over curtailment of its nuclear program last Thursday, which requires Iran to limit its enrichment capacity and stockpile. The deal will see the European Union lifting economic sanctions on Iran, which has roiled the Iranian economy for long. However, analysts say the U.S. may only lift sanctions until Iran's implementation of the deal is confirmed.

The deal in Lausanne, Switzerland came about after months of protracted talks with between the two sides.

The dollar also fluctuated after some soft U.S. employment data with jobs rising much lesser than expected in March and the dollar trending lower against the euro.

In the latest amid a recent string of disappointing economic data, the Labor Department's report on Friday showed employment in the U.S. rose less than expected in March.

The non-farm payroll employment rose by 126,000 jobs in March following a downwardly revised increase of 264,000 jobs in February. Economists expected employment to increase by about 245,000 jobs compared to the addition of 295,000 jobs originally reported for the previous month.

Meanwhile, the unemployment rate remained at a six-year low of 5.5 percent in March, unchanged from February and in line with economist estimates. Analysts say the jobs growth is consistent with the softer data seen in recent months but suggested bad weather and the West Coast port disruption to have distorted the true picture for the economy.

Light Sweet Crude Oil futures for May delivery, the most actively traded contract, soared $3.00 or 6.1 percent to settle at $52.14 a barrel on the New York Mercantile Exchange Monday.

Crude prices for May delivery scaled a high of $52.22 a barrel intraday and a low of $49.47.

On Thursday, crude oil dropped $0.95 or 1.9 percent to settle at $49.14 a barrel after Iran and the world powers reached a deal in broad general terms which will curtail Tehran's nuclear program for uranium enrichment.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 96.74 on Monday, up from its previous close of 96.59 on Thursday in late North American trade. The dollar scaled a high of 96.82 intraday and a low of 96.33.

The euro trended higher against the dollar at $1.0983 on Monday, as compared to its previous close of $1.0972 in North American trade late Thursday. The euro scaled a high of $1.1037 intraday and a low of $1.0966.

In other economic news, growth in U.S. services sector slowed in March with a slowdown in production contributing to the decreased pace of growth. Nevertheless, March also saw a pick up in new orders, with prices and employment expanding as well.

The Institute for Supply Management said its index of non-manufacturing activity for the U.S. came in at 56.5 for March, down from the level of 56.9 seen in the previous month. The reading represented the slowest growth for the non-manufacturing segment this year, similar to the result seen in December.

Meanwhile, the new orders index climbed to 57.8 in the month, compared to a reading of 56.7 in the previous month. The employment index ticked up to 56.6 from 56.4. The prices index rose to 52.4 from 49.7 in the previous month, after a contraction in February.