London: Oil hit a two-week high above $75 yesterday but then fell back sharply after US economic data made investors more cautious on a range of riskier assets.
Business activity in the US Midwest fell more than expected in May as employment declined, the Institute for Supply Management-Chicago business barometer showed.
The data helped raise risk aversion in a number of markets with oil, metals and equities all slipping or losing some of their earlier gains.
But oil prices were still up more than six per cent for the week as a whole after official data earlier showing soaring fuel demand in top consumer the United States.
Asian stocks rallied for a third day on Friday, with Japan's benchmark Nikkei rising 1.3 per cent to its highest last week. The FTSEurofirst 300 index of top European shares up 0.2 per cent.
US crude futures for July delivery jumped to a high of $75.72, up $1.17 per barrel, before sliding back to $74.55 by 1406 GMT, unchanged on the day. ICE Brent was up 6 cents at $74.72.
"The Chicago PMI has knocked most markets," said Eugen Weinberg, commodities analyst at Commerzbank in Frankfurt. "All the commodities that worry about risk have softened — oil, metals, and so have equities."
