* Jobless claims data shows labor market recovery gaining
* U.S. senators introduce bill to approve Keystone XL
* Obama says Iran more than a year away from nuclear weapon
* Coming Up: U.S. industrial output; 1315 GMT
By Manash Goswami
SINGAPORE, March 15 Brent futures rose above
$109 a barrel on Friday as strong U.S. jobs data fuelled hopes
of a better outlook for demand in the world's top oil consumer,
while simmering concerns over supply from the Middle East added
Investors took on more risk as the jobs data added to a
string of positive numbers suggesting a steady recovery in the
world's largest economy, pushing up Asian shares and base
Oil got a further boost after President Barack Obama said
military force remained an option if sanctions and diplomacy
failed to thwart Iran's nuclear ambitions.
Brent crude rose 50 cents to $109.46 a barrel by
0345 GMT, gaining for a second day after snapping four straight
days of losses. The April contract, which expired on Thursday,
settled 90 cents higher, but the benchmark is poised for its
fourth weekly decline in five weeks.
U.S. oil gained 28 cents to $93.31 a barrel, and is
set to post its second straight week of gains.
"The numbers we are seeing in the United States are a result
of the cheap money that has been available," said Jonathan
Barratt, chief executive of Sydney-based commodity research firm
"On the fundamental side, Iran is an issue. When Obama says
Iran is more than a year away from a nuclear weapon, it means
one year too close."
Iran was still more than year away from developing a nuclear
weapon Obama said in an interview with Israeli television
broadcast on Thursday, just six days before his visit to Israel.
Obama appeared to send a message to Prime Minister Benjamin
Netanyahu of the need for patience with Washington's Iran
strategy while also showing U.S. resolve to confront Tehran if
Worries the standoff between the West and Iran over the
Islamic Republic's controversial nuclear programme will escalate
and disrupt oil supplies have kept Brent above $100 a barrel
through most of 2012 and this year despite weak demand.
The number of Americans filing new claims for unemployment
benefits dropped for a third straight week last week, the latest
indication the labor market recovery was gaining traction.
Beyond fundamental factors of demand growth and supply
concerns, U.S. oil is gaining faster than Brent because
investors are unwinding positions on the spread of the two
The difference has narrowed nearly $8 a barrel after
touching $23.45 on Feb. 8, the widest since end-November.
The U.S. benchmark is gaining faster as work progresses on a
key pipeline that will help ease a glut of oil in the United
States as a result of a drilling boom.
A bipartisan bill introduced in the U.S. Senate on Thursday
would give Congress the power to approve TransCanada Corp's
Keystone XL pipeline project to link Canada's oil sands
with refineries and ports in Texas.
The U.S. contract has gained nearly 5 percent from the low
of $89.33 a barrel for the year touched on March 4, which was
its weakest since end-December. It opened at about $92 for the
year and rose to a high of more than $98 on Jan. 30.
The European benchmark, in contrast, is just about $2 away
from the low of $107.91 for the year hit on March 13, which was
its weakest since mid-December.
"There is a realignment happening because of the pipeline
and how that is helping ease the glut of oil in the United
States," Barratt said.
Prices will also remain supported by resilient demand from
China, the world's second-largest oil consumer, despite recent
comments by the country's central bank about ending its easy
monetary policy as inflation accelerates, he said.
"I am always bullish about demand from Asia," Barratt said.
"It will remain steady as China maintains economic growth at
around 7 percent to 7.5 percent."
(Reporting by Manash Goswami)