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Oil prices slip in Asian trade

SINGAPORE: Oil prices slipped on profit-taking in Asia Friday, unwinding sharp gains in the previous session fuelled by concerns unrest in the Middle East could hurt supplies from the crude-rich region, analysts said. 

US benchmark West Texas Intermediate (WTI) fell 32 cents to $57.42 while Brent eased 28 cents to $64.57 in afternoon trade.

On Thursday WTI gained $1.58 and Brent advanced $2.12.

“It seems to be profit-taking at the moment for oil after gains due to supply-side and geopolitical catalysts,” Nicholas Teo, market analyst at CMC Markets in Singapore, told AFP.

“Rumblings from Saudi Arabia about Yemen have influenced prices in the past few days,” he added.

Saudi-led warplanes launched more deadly strikes in Yemen Thursday despite a demand by Iran-backed rebels for a complete halt to the raids as a condition for UN-sponsored peace talks.

The new wave of strikes killed at least 23 rebels as the World Health Organisation said the overall death toll from fighting since late March topped 1,000.

Yemen is not a major oil-producing country, but its coast forms one side of the Bab el-Mandeb Strait, the key strategic entry point into the Red Sea through which some 4.7 million barrels of oil passes each day on ships headed to or from the Suez Canal.

Daniel Ang, investment analyst at Phillip Futures in Singapore, said oil prices will likely see further gains following signs that US crude production is easing.

The US Department of Energy said Wednesday production slipped by 18,000 barrels a day in the week to April 17, following a 20,000 barrel drop in the previous week.

Total reserves in the top crude consumer, however, stand at record levels, adding 5.3 million barrels in the same period.

Dealers are hoping a slowdown in US shale output could alleviate a global crude oversupply, which led prices to more than halve between June and January.

“Although inventories obviously show bearishness, production has stopped increasing, which is an event we have been waiting for” since prices hit their low, Ang said. (AFP)

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