Oil prices were mixed in Asian trade today, with US crude extending its rebound from five-month lows on stronger demand in the world’s biggest economy, analysts said.
New York’s main contract West Texas Intermediate (WTI) for December delivery was up 16 cents at $94.96 a barrel in morning trade, while Brent North Sea crude for December fell 14 cents to $105.10.
WTI “posted significant gains after the EIA (Energy Information Administration) reported US gasoline inventory dropped 3.755 million barrels, much more than the projected 300,000 barrels decline,” Singapore’s United Overseas Bank said in research note.
A decline in inventories indicate stronger demand in the world’s biggest economy and oil consuming nation, boosting prices.
Crisis in Libya and Egypt
Analysts said the decline in Brent prices was tempered by concerns over the extended closure of key oil facilities in Libya, as well as the political situation in Egypt which many fear could escalate.
“The continuing crisis in Libya and Egypt will support Brent prices and the Brent-WTI spread is unlikely to narrow in the near term,” said Sanjeev Gupta, head of the Asia Pacific oil and gas practice at Ernst and Young.
Protesters have kept up their blockade of the Al-Hariga terminal in eastern Libya, scuppering plans to reopen the facility on Monday.
Output from the Al-Sharara field, which produces 330,000 barrels per day, had also been blocked by the residents of the southern region of Ubari since October 28.
The protesters are demanding a fairer distribution of the region’s resources to improve the living conditions.
Gupta said data from the US on the gross domestic product and jobs “will set the tone in the coming weeks” for oil prices.