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Oil prices down in Asia

By Haris Afzal on Friday, January 28, 2011 with 0 comments

SINGAPORE: Crude prices fell in Asian trade on Friday as investors braced for further interest hikes in China, the world's largest energy consumer, analysts said.

New York's main contract, light sweet crude for March delivery, was down 49 cents at $85.15 per barrel.

Brent North Sea crude for March dipped two cents at $97.37.

Reports that Saudi Arabia is pumping more oil also dampened sentiment, analysts said.

"Another factor could be investors are wary that China could come up with additional tightening measures over the Lunar New Year," said Ong Yi Ling, investment analyst for Phillip Futures in Singapore.

Chinese state media reported this month that interest rates could be raised further around the Lunar New Year next month to combat rising inflation during the first half of 2011.

Crude prices have been affected by several factors in recent sessions such as poor US economic data showing higher jobless claims and disappointing orders of durable goods, Japan's debt downgrade and rising US energy stocks.

Standard & Poor's on Thursday cut Japan's credit rating for the first time since 2002, accusing the government of lacking a "coherent strategy" in efforts to ease the highest debt of any industrialised nation.

On Wednesday, US data also showed an unexpectedly sharp build in US crude inventories, indicating soft demand.

Crude inventories in the world's largest oil consumer jumped 4.8 million barrels in the week ending January 21, compared with analyst expectations for a gain of 900,000 barrels.

Category: Business News

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