Singapore: World oil prices eased on Tuesday, 25 September, in Asian trade but analysts said concerns over tight supplies would limit the losses in a market that remained above $80 a barrel.
At 10:59am (0259 GMT) New York’s main oil futures contract, light sweet crude for delivery in November, was 62 cents lower at $80.33 a barrel compared with $80.95 in late US trades on Monday.
The contract first breached $80 earlier in September before climbing even higher to an all-time peak of $84.10 last Thursday on fears that a storm could threaten oil facilities in the Gulf of Mexico.
Tight supplies in the world’s biggest energy consumer, the US, also helped push prices to record high levels.
Brent crude, which struck a record high $79.94 a barrel on Friday, was 59 cents lower on Tuesday at $78.32. Prices had begun slipping after the Gulf storm threat eased.
Tobin Gorey, a commodities strategist with the Commonwealth Bank of Australia in Sydney, said the market was getting a reprieve but was unlikely to suffer an accelerated fall.
“It’s run out of steam for the time being,” Gorey said.
Barclays Capital analyst Kevin Norrish said earlier that the price decline “does not in our view represent any significant change in underlying market fundamentals, which are continuing to tighten.”
On Monday a top official with the International Energy Agency (IEA) warned that short and medium-term oil prices would likely remain high, citing demand-supply tensions and robust growth in China and India.
“In the very short term, there is a strong likelihood that prices will stay high,” said Didier Houssin, head of the oil market unit at the IEA, an energy policy adviser to major industrialised countries. He was speaking on French radio.