|
LONDON: Oil prices gained ground on Thursday as the
market digested the latest stockpiles data in leading consumer the
United States which traders said was supportive overall.
The price of London’s Brent
North Sea crude for August delivery rose 41 cents to $68.74 a
barrel.
New York’s main futures
contract, light sweet crude for August, gained 33 cents to $69.
“It’s all about gasoline at
the moment,” said VTB Capital analyst Andrey Kryuchenkov.
The US Department of Energy said
Wednesday that inventories of gasoline jumped 3.9 million barrels in
the week ending June 19, compared to expectations for a gain of one
million barrels.
But crude stockpiles dropped by
3.8 million barrels, steeper than the 1.3 million barrels expected
by most analysts.
“A mixed enough report but
somewhat supportive for crude,” Kryuchenkov noted, adding: “We
are still pleased to see stable gasoline demand.”
Oil also got support on the back
of a weaker US currency, which makes dollar-priced crude cheaper for
buyers using stronger currencies and therefore tends to stimulate
demand and push prices higher.
Conflicting signals about the
strength of a recovery for the global economy have led to volatile
swings in oil prices recently, with some analysts saying they have
risen too fast while underlying demand is weak.
Crude oil plunged from record
peaks of more than $147 in July 2008 to about $32 in December as the
economic downturn hit but the market has since won back some ground
on recovery hopes.
Traders meanwhile tracked
post-election tensions in key crude producer Iran and fresh rebel
attacks on oil facilities in Nigeria.
Asian oil trade
From Singapore, Agence France-Presse
reported that oil prices turned higher in Asian trade Thursday,
approaching $69 a barrel, after the greenback fell against the euro,
analysts said.
The dollar’s performance is a
key factor in the oil market because a stronger greenback makes the
dollar-priced commodity more expensive for holders of other units,
dampening demand and leading to lower prices.
The US unit had a boost Wednesday
after the policy-making Federal Open Market Committee of the US
central bank reaffirmed its policy of keeping interest rates at near
zero.
It extended its gains against the
Japanese yen, rising to 96.19 yen in Tokyo afternoon trade Thursday,
from 95.62 in New York late on Wednesday. But it fell against the
euro, with the European unit up at $1.3962 from $1.3926.
“It’s really the currency
movement that continues to be a driver of oil prices in the near
term,” said Victor Shum, a senior principal at energy consultancy
Purvin and Gertz in Singapore.
Market controls
OPEC and the European Union (EU)
believe that the price surge of international crude oil prices last
year was mainly caused by speculation, which should be better curbed
through improving financial market control.
The sixth ministerial-level
meeting of the Energy Dialogue between EU and OPEC took place in
Vienna on Tuesday. At a joint press conference with ministers from
OPEC member states, Andris Piebalgs, European commissioner for
Energy, noted that the financial market control mechanism should be
improved in the future in order to better curb market speculation.
Secretary General of OPEC Abdalla
Salem El-Badri also said that the surge of international oil prices
to $140 a barrel last year was not caused by a shortage of supply,
but by excessive speculation. He added that there was now plenty of
crude oil supply in the world, and “even if the economy recovers,
we still have enough crude oil to meet the increasing demand. No
matter how much the world demands, we are able to supply.”
Piebalgs also noted that now the
world has some six million barrels of spare capacity a day. But EU
and OPEC have obvious difference of views on international oil
prices.
Piebalgs said he believed that
the current international oil prices would neither hinder the
recovery of the world economy, nor curb further investment in the
petroleum industry.
But El-Badri would like the
prices to be higher, saying that “even $80 a barrel will not
impact the world’s economic recovery, while $50 to $55 a barrel
can not maintain re-investment.”
He also pointed out that OPEC has
not cut production for the last two meetings to give the world a
chance to recover. But the OPEC Ministerial Conference in September
will adjust the current output quota.
President of the OPEC Conference
Jose Maria Botelho de Vasconcelos, minister of Petroleum of Angola,
said he hoped to boost oil prices to $80 a barrel so as to guarantee
investment.
El-Badri also said on the Monday
also that at least “in the foreseeable future, fossil fuels will
still occupy a dominant position in the world energy mix.”
--AFP And Xinhua
|
