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Oil prices rebound in Asian trade
Friday, January 11, 2008
SINGAPORE (Thomson Financial) - Oil prices rebounded in Asian trade Friday after recent heavy falls on worries about a United States recession that could dampen global demand for crude.
In afternoon trade, New York's main contract, light sweet crude for delivery in February, increased 71 cents to 94.42 dollars a barrel.
The contract slid by 1.96 dollars to settle at 93.71 in New York on Thursday.
Brent North Sea crude for February gained 67 cents to 92.89 dollars.
Despite Friday's rise, traders remain worried that a recession in the United States could slash demand from the world's biggest energy consuming nation.
The US economy, the biggest in the world, is also a major buyer of global exports and any slowdown could affect other economies as well.
"The dramatic slide on Thursday reiterates the fact that the US (economic) slidedown is looking imminent," said Steve Rowles, an analyst at CFC Seymour Securities in Hong Kong.
Federal Reserve chairman Ben Bernanke said Thursday that the outlook for US growth in 2008 had "worsened" because of the housing meltdown, rising oil prices and weakened stock markets.
He said "additional monetary easing may be necessary," suggesting the central bank will cut interest rates by more than expected at a policy meeting scheduled for January 29-30.
Last week, crude prices topped 100 dollars a barrel, partly buoyed by reports of falling US crude supply and political tensions in nuclear-armed Pakistan.
New York crude struck a record 100.09 dollars last Thursday and Brent also hit a new high at 98.50.
"Indications of a slowing economy continue to mount," said John Kilduff of MF Global.
"Fears over weakening oil demand seem to be outweighing concerns over supply, and this has already led to a significant price retrenchment over the last week," Kilduff said.
