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Oil prices move up slightly

business Updated: Aug 07, 2008 09:46 IST

AFP
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Oil prices were slightly higher in Asian trade Thursday after steep falls in recent sessions on worries about waning energy demand, especially in the United States, dealers said.

In morning trade, New York's main contract, light sweet crude for September delivery, rose 30 cents to 118.88 dollars a barrel.

London's Brent North Sea crude for September delivery added 45 cents to 117.45.

"I think it's partly that it has been such a big sell-off (in recent sessions)," said Jason Feer, from energy market analysts Argus Media in Singapore.

Oil prices have tumbled this week on new concerns about demand amid signs of slowing global growth. Crude is down almost 20 percent since reaching record highs above 147 dollars last month.

Prices fell Wednesday after an unexpected jump in US crude reserves but a bigger-than-expected drop in gasoline stockpiles was the other surprise element for the market.

The US Department of Energy announced in its weekly report Wednesday that American crude reserves increased by 1.7 million barrels in the week ended August 1.

The reading caught the market off guard because expectations had been for a 200,000-barrel decline. The weekly report often has an impact on market prices.

Motor fuel stockpiles plunged 4.4 million barrels, well beyond consensus forecasts for a drop of 1.5 million. "The gasoline numbers have probably raised enough doubts in traders' heads... they probably want to see some more data to see if that is the trend," said Feer.

Traders are closely tracking the level of US gasoline stockpiles amid the ongoing peak-demand summer driving season, when many Americans take to the roads for their holidays.