Oil prices turn higher in Asian trade
AFP
SINGAPORE
Petroleumworld.com 02 09 06
Oil prices turned higher in Asian trade Thursday, recovering some
recent lost ground with Iran's controversial nuclear energy program
still a source of concern, dealers said.
At 11:24 am (0324 GMT), New York's main contract, light sweet
crude for delivery in March, was up 18 cents to 62.73 dollars
a barrel from its close of 62.55 dollars in the United States
Wednesday where it had dropped 54 cents to its lowest level in
several weeks.
"Some of the commodity investors went back into the market
with the Iranian issue still looming as a worry," said Victor
Shum, an analyst with energy consultancy Purvin and Gertz in Singapore.
"The fact that we have the longer-term threat of supply disruption
due to the Iran issue ... will add a risk premium to crude prices,"
he said.
Iran's nuclear energy program has triggered a strong condemnation
from the international community with the IAEA voting last Saturday
to refer Tehran to the UN Security Council over the issue.
Tehran has responded by resuming uranium enrichment and stopped
spot checks of its nuclear sites by the United Nations, raising
fears of further retaliatory moves that could disrupt crude supplies
from the oil rich country.
The Islamic republic is the second-biggest producer within the
Organization of Petroleum Exporting Countries (OPEC) and exports
2.7 million barrels of crude per day.
Tehran contends that its nuclear research is for peaceful purposes
but the government is suspected by the United States and Europe
of trying to develop nuclear weapons.
In other developments, the US Department of Energy's (DoE) latest
weekly report on Wednesday showed a drop in crude oil inventories
of 300,000 barrels to a level of 320.7 million barrels in the
week to February 3.
That contrasted with market expectations of a rise of 700,000
barrels.
But the agency noted that crude reserves were 10.7 percent above
the levels at the same time last year.
Reserves of distillates, used for heating and diesel fuel, dipped
300,000 barrels to 136 million, according to the DoE, compared
with the market's forecast rise of 150,000 barrels. Nonetheless,
distillate supplies are 12.4 percent above last year's levels.
Gasoline or petrol inventories jumped 4.3 million barrels to 223.3
million, more than double analysts' consensus forecasts of a 1.9-million-barrel
build.
As a result, gasoline supplies in the United States are now 1.7
percent above their level at the same stage last year.
Oil prices gained almost nine percent in January on strong fund
buying and rising geopolitical tensions, mainly in Iran and Nigeria,
which together account for about eight percent of global crude
oil production.
AFP
02/09/06
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