Oil prices eased on profit-taking in Asian trade today while dealers grow cautious over a supply glut and waning global demand, analysts said.
New York’s main contract, light sweet crude for delivery in July, dropped a cent to $96.68 a barrel and Brent North Sea crude for August delivery shed 20 cents to $104.75.
Both contracts had closed higher yesterday following upbeat US economic data.
“Oil has gone up quite a bit in the past couple of weeks, so it is due for some technical resistance,” Kelly Teoh, market strategist at IG Markets in Singapore, said.
Ric Spooner, chief market analyst at CMC Markets in Sydney, said: “Underlying fundamentals look precarious, with oversupply variables and a waning demand.”
The World Bank had yesterday slashed its 2013 growth forecast for China to 7.7 per cent from a previous estimate of 8.4 per cent, warning of a potential “sharp” slowdown triggered by a fall in investment.
It also shaved its global growth forecast to 2.2 per cent from 2.4 per cent, largely due to the Euro Zone recession.
The market was also watching developments in Sudan following an oil pipeline blast.
Sudan’s army had yesterday blamed South Sudanese-backed rebels for the explosion in the disputed Abyei area, as African mediators try to salvage an oil export pact between the two nations.
The allegation comes two days after Sudan’s petroleum ministry formally told oil companies to block exports of crude from the South within 60 days, reigniting tensions after weeks of calm between the two sides.