Oil prices steady after sharp fall

Oil prices steady after sharp fall
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First Published: Fri, May 30 2008. 09 41 AM IST
Updated: Fri, May 30 2008. 09 41 AM IST
AFP
Singapore: World oil prices held steady in Asian trade on 30 May after a sharp fall on concerns over falling demand in the United States and other developed countries.
New York’s main oil futures contract, light sweet crude for July delivery, was 17 cents lower at $126.45 a barrel after losing a hefty $4.41 to close at $126.62 per barrel in trading at the New York Mercantile Exchange on 29 May.
Brent North Sea crude for July delivery was 11 cents lower at $126.78 a barrel following a slide of $4.04 to settle at $126.89 dollars on 29 May in London.
The slide in prices came after both contracts struck historic peaks a week ago. Brent hit $135.14 and New York prices reached $135.09 on tight supply fears.
“I guess the market’s sort of factoring in the growing understanding that demand in the US is just not gonna recover,” said Jason Feer, of energy market analysts Argus Media Ltd in Singapore.
Prices initially jumped higher after a weekly report on United States energy stockpiles. Values then tumbled as some analysts questioned if energy demand was dropping amid sky-high prices.
In its report, the U.S. Department of Energy (DoE) said American crude reserves slumped 8.8 million barrels in the week ending 23 May.
Feer said analysts concluded there had been a problem unloading stocks of crude because of fog at U.S. terminals, and in fact there is a lot of oil “sitting in tankers offshore”.
“Gasoline or petrol stockpiles tumbled 3.2 million barrels,” the DoE said. Market expectations had been for no change. The DoE report was published one day later than usual due to a public holiday in the United States.
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First Published: Fri, May 30 2008. 09 41 AM IST
More Topics: Commodities | Energy | Oil | Brent Crude | Nymex |