Oil rises toward $80, eyes on US October jobs data

By Fayen Wong

PERTH (Reuters) - Oil rose slightly on Friday, supported by positive U.S. economic data, but wariness ahead of monthly jobs data from the United States limited gains and kept its price below the psychologically key $80 level.

Despite data showing jobless claims in the U.S. fell to a 10-month low last week and non-farm productivity rose at its fastest pace in six years in the third-quarter, oil prices fell nearly 1 percent on Thursday as high fuel inventories in the United States raised worries about a recovery in oil demand.

U.S. crude for December delivery crept up 12 cents to $79.74 a barrel by 0025 GMT, after shedding 78 cents to settle at $79.62 on Thursday.

London Brent crude rose 31 cents to $78.30.

The labour market is being closely watched as analysts try to gauge the strength and durability of a government stimulus-driven recovery that started in the third quarter and probably ended the worst U.S. recession since the 1930s.

"There's not much news in the market. Traders are still looking to the U.S. unemployment report for directions," said Clarence Chu, a trader at Hudson Capital Energy in Singapore.

U.S. employers in October are expected to have cut payrolls by the smallest amount in 14 months as the economy's resumption of growth boosted optimism, but the jobless rate still rose to a fresh 26-year high of 9.9 percent in October, a Reuters survey predicts.

A higher-than-expected jobless rate or a bigger loss of jobs than forecast could rattle investors on Wall Street and the energy complex, and send them fleeing into the safe haven of U.S. government bonds and the U.S. dollar.