Oil rebounds from eight-month lows
Singapore; Crude prices bounced back from eight month lows in Asian trade today on bargain hunting and concerns over the intensifying conflict in South Sudan.
New York's main contract, West Texas Intermediate (WTI) for February delivery was up 74 cents to USD 92.40 a barrel in mid-morning trade, while Brent North crude for February gained 29 cents to USD 106.68.
WTI prices hit their lowest levels since May 1 yesterday, weighed down by high US crude and product stockpiles that suggest supplies continue to outpace demand, giving an opportunity for investors to hunt for bargains.
Sanjeev Gupta, head of the Asia-Pacific oil and gas practice at consultancy firm Ernst and Young, said high US inventories "continued to pressure prices lower".
Data released on Wednesday showed that US weekly crude oil inventories fell by 2.7 million barrels, exceeding analysts' predictions.
Gasoline stockpiles, however, were up.
Investors were also monitoring developments in oil-producing South Sudan after the government's peace talks with rebels reached a deadlock.
The country's oil production has dropped by around a fifth because of the fighting, depriving the impoverished nation of a key source of foreign currency.
Michael McCarthy, chief market strategist at CMC market in Sydney, said the intensifying conflict is "probably insignificant" in terms of oil prices in the global market.
"But it's a reminder for the potential of disruption in oil supplies," he said.