Oil rose to a seven-month high above $70 per barrel on Friday after much better-than-expected U.S. employment data pushed stocks higher and depressed the dollar.
A government report said U.S. employers cut 345,000 jobs last month, the fewest since September and far less than forecast, suggesting the economy's severe weakness was diminishing.
U.S. crude for July delivery were up 90 cents at $69.71 per barrel by 1250 GMT after peaking at $70.32.
London Brent was up 50 cents at $69.21.
"The unemployment data is much better than forecast," said Mike Wittner, head of research at Societe Generale.
Analysts say oil prices are being driven by macro-economic data from the United States because it is the world's biggest oil consumer and key to global oil demand.
"Buyers are hoping that an imminent global economic recovery, coupled with continued weakness in the dollar, will eventually improve the currently weak fundamentals," said brokers MF Global.
Oil prices have risen sharply from lows near $30 a barrel this winter but are still less than half their record peak last July at over $147 as recession has bitten deep into oil demand.
U.S. investment bank Goldman Sachs said on Thursday a potential economic rebound alongside production cuts by OPEC could propel crude to $85 a barrel by the end of the year and to $95 a barrel by the end of 2010.
This view is shared broadly by the head of the Organization of the Petroleum Exporting Countries Oil producing group, who told Reuters Energy Summit this week that prices could reach $80-$90 per barrel by early next year.
Rising stock markets are supporting expectations that the global economy may begin to recover sooner rather than later.
U.S. stock index futures jumped after the U.S. jobs data.
S&P 500 futures rose 12.90 points while Dow Jones Industrial Average futures jumped 118 points.
Japan's Nikkei stock average rose 1 percent on Friday to an eight-month closing high, lifted by resource and energy shares amid a climb in commodity prices. European shares were stronger by midday on Friday, buoyed by mining and oil companies. .T .EU
The dollar gained against the yen and fell against the euro after the jobs data but later recovered a little.
