Oil prices up in Asia trade
Oil rose in Asian trade on Thursday as traders invested in cheap crude on the back of sliding prices, analysts said.business Updated: Dec 10, 2009 07:52 IST
Oil rose in Asian trade on Thursday as traders invested in cheap crude on the back of sliding prices, analysts said.
New York's main futures contract, light sweet crude for delivery in January, gained 38 cents to 71.05 dollars a barrel after closing at a two-month low in overnight trade in the US.
Brent North Sea crude for January delivery was up 42 cents to 72.81 dollars.
Investors were snapping up oil as crude prices headed south in recent sessions, analysts said.
"You probably have a lot of financial players viewing a dip in oil prices as an opportunity to put more money back into oil," said Jason Feer, Asia-Pacific vice-president of energy analysts Argus Media in Singapore.
However, oil markets were still reeling from a dearth of energy demand as evinced by data released by the US Department of Energy (DoE) Tuesday, Feer cautioned.
The DoE report showed distillate inventories increasing by an unexpected 1.6 million barrels for the week ended December 4, against analyst predictions of a 500,000-barrel fall.
Calling the data "bearish," Feer said a gain in US distillate stocks at this time of year was symptomatic of weak energy demand, and offset a 3.8 million fall in crude stockpiles.
"The fact that you have a build in distillate stocks in chilling season... shows a weakness in (energy) demand," he said.
Distillates include diesel and heating fuel, which usually see rising demand at this time of year as the northern hemisphere winter approaches.