Oil rebounds in Asian trade

January 28, 2010

, SINGAPORE, Jan 28 – Oil prices rebounded in Asian trade Thursday after steep declines overnight following the release of mixed energy stockpiles data from the United States.

New York\’s main futures contract, light sweet crude for delivery in March, climbed 32 cents to 73.99 dollars a barrel. It dropped 1.04 dollars to 73.67 dollars in New York trade Wednesday, its lowest close since December 22.

London\’s Brent North Sea crude for March delivery was up 22 cents to 72.46 dollars.

Analysts said the closely watched weekly stockpiles report for the United States, the world\’s biggest energy consumer, depressed the market.

"The large crude draw was positive but products continue to disappoint," said DnB Nor Markets analyst Torbjorn Kjus.

The US Department of Energy said Wednesday that crude oil inventories plunged 3.9 million barrels in the week ended January 22, surprising most analysts who had expected an increase.

However, the crude stockpiles were still 5.1 percent below their year-earlier level.

Distillates — including diesel and heating fuel — rose 400,000 barrels last week, instead of the much larger increase expected by the market.

Gasoline reserves increased more than anticipated, by two million barrels, and were 6.0 percent higher than a year ago.

Jeffery Dawkins of The FQ Group said that commodity prices were under pressure as the dollar strengthens and equity markets tumble.

Beijing\’s moves to cool its economy, including moves to tighten bank lending, were also dampening sentiment as China is the world\’s second biggest energy consuming nation, other analysts said.

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