Oil prices rebounded on Friday and headed for their first weekly gain in more than a month as optimism over debt ceiling talks in Washington offset China recovery worries.
Benchmark Brent crude futures climbed 0.8 percent to $76.50 a barrel, while WTI crude futures were up 0.7 percent at $72.39.
The dollar held near a six-month high after Democratic negotiators reportedly told U.S. President Joe Biden they were making "steady progress" on a deal to lift the U.S. debt ceiling and avoid a debt default.
Biden and House of Representatives Speaker Kevin McCarthy hope to finalize a deal on the debt ceiling after Biden returns from the Group of Seven meeting in Japan on Sunday.
U.S. Vice President Kamala Harris and Biden's top economic adviser, Lael Brainard, said a debt default could trigger a recession.
U.S. Treasury Secretary Janet Yellen told top bank executives that a failure to raise the debt ceiling would be "catastrophic" for the financial system.
Continued wildfires in Alberta, Canada's top energy producing province, also supported oil prices ahead of U.S. Baker Hughes oil rig count data due to be released in the New York session.
