An unexpected drop in jobless claims helped spur U.S. oil to a 16-month high on Thursday, narrowing its differential with Brent crude amid growing signals of strengthening domestic demand.
As risk appetite sparked a furious rally that sent major stock indexes to new records, U.S. light, sweet crude jumped in tandem, reaching an intraday high of $108.32 before paring some of those gains. Meanwhile, Brent crude was marginally higher, climbing about 15 cents to trade under $109, raising the possibility that West Texas Intermediate (WTI) may soon overtake its international counterpart.
The WTI contract settled up $1.56 at $108.04, its highest since March 2012.
"The economy seems to be rebounding, and a few signals suggest we're coming out of the recent trough," said Richard Hastings, macro strategist at Global Hunter Securities. "There's a little more pricing power in the economy, and a variety of different signals suggest the economy is perking up."