Singapore: Oil prices paused for a breather in Asian trade on 23 July after surging to levels not seen in a year on strong demand and geopolitical concerns, dealers said.
Supply concerns were also a factor behind the price surge seen last week, they said.
In the past month, crude prices have climbed about $5 in New York and $7 in London.
At 10:30 am (local time), New York’s light sweet crude for September delivery was 34 cents lower at $75.45 a barrel from $75.79 in late US trades on 20 July.
Brent North Sea crude for September was 40 cents lower at $77.24 but was still within striking distance of its record high of $78.64 struck on 7 August 2006.
“Even with oil prices at this level, demand for oil continues to increase and that’s the key,” said Phil Flynn, an analyst at Alaron Trading.
The International Energy Agency, which defends consumer countries’ interests, says global demand, which had slowed in 2006, would continue to rebound this year and the next, despite elevated prices, while surplus production capacities would dwindle.
US gasoline (petrol) demand has also remained strong despite higher prices, causing worries among traders over whether the country’s refineries can keep up with with the market.
Data from the US Department of Energy (DoE) showed motor fuel consumption hit 9.71 million barrels per day, the second-highest level to date.