Oil Up in Asian Trade
SINGAPORE : Oil prices rose in Asian trade on Monday, boosted by reports forecasting a hike in crude demand, seen as an indicator of economic recovery, analysts said.
New York’s main contract, light sweet crude for delivery in November, gained 47 cents to 72.24 dollars a barrel.
Brent North Sea crude for November delivery climbed 43 cents to 70.43 dollars.
Crude prices were lifted by an International Energy Agency (IEA) report on Friday saying demand was expected to improve at the end of this year and in 2010 as the global economy recovers from a slump, analysts said.
“The IEA sharply revised its oil demand forecast for 2010 upwards, so that has added to the buoyant mood,” said Victor Shum, a senior principal with energy consultancy Purvin and Gertz in Singapore.
Despite its upbeat forecast on demand, the IEA report cautioned that the oil price was unlikely to rise much.
Demand has plunged amid the worst financial downturn since the Great Depression, with oil prices falling from historic highs of more than 147 dollars in July 2008 to about 32 dollars in December, but have since won back ground on recovery hopes.
Despite the turnaround from depressed levels, oil demand in 2010, even after the expected “rebound” “will still remain below 2008 levels,” said the IEA’s monthly report.
The agency revised upwards its estimate for global oil demand this year by a moderate amount of 200,000 barrels per day and for next year by 350,000 barrels per day.
Oil Up in Asian Trade was first posted on October 12, 2009 at 4:41 pm.
Oil Higher in Asian Trade
SINGAPORE: Oil rose in Asian trade on Monday, with investor mood upbeat that the global economy was over the worst of the slump, analysts said.
In particular, a stronger-than-expected set of US corporate earnings has fuelled hopes that the world’s largest economy was on the mend from a recession that started late last year, they said.
New York’s main contract, light sweet crude for September delivery, put on 39 cents to 68.44 dollars a barrel.
Brent North Sea crude for September delivery was 38 cents firmer at 70.70 dollars.
“People concluded that Asia seems to have turned the corner — now the US is also thought to be recovering,” said Tony Nunan, a Tokyo-based manager with Mitsubishi Corp’s international petroleum business unit.
In Asia, a strong 7.9 percent surge in second quarter growth from China’s economy has bolstered hopes that the region is also starting to shake off the US-led global slump.
After the United States, China is the number two energy user in the world.
Crude prices have surged about 10 dollars in New York over the past two weeks, energised by strong US corporate earnings and economic data suggesting the US and other key economies are starting to recover.
However, Phil Flynn of PFG Best Research cautioned that the rise in oil prices was not supported by economic fundamentals.
“Oil has ignored bearish supply and demand fundamentals as the fundamentals of expectations of an improving economy seem to be a bit more exciting,” Flynn said.
“After this pop, oil will fall hard.”
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Oil Higher in Asian Trade
