SINGAPORE (XFN-ASIA) - Oil prices were mixed in Asian trading hours in a market driven by healthy fundamentals and a focus on US refineries' return to production, traders said.
At 11.36 am here (0336 GMT), the New York Mercantile Exchange's main oil futures contract, light sweet crude for delivery in May, was up 0.18 usd at 62.01 usd per barrel from 61.83 usd per barrel in late trading in the US overnight, when it had declined a hefty 1.30 usd. Brent North Sea crude for June delivery was down 0.37 usd at 65.57 usd per barrel.
Traders said the price falls were mainly tied to reports that US refiners were stepping up their output.
'In the near term, supply is sufficient to meet crude demand in the year's second quarter,' said CFC Seymour senior investment strategist Dariusz Kowalczyk.
'Fundamentals are driving the market, and the concerns over China are misplaced,' he said.
China said yesterday that its economy was 11.1 pct bigger in the first quarter of this year than in the first quarter of last year, and Premier Wen Jiabao called for steps to prevent fast growth from leading to an overheated economy.
'Yesterday, investors were concerned over a slowdown in demand for commodities, including oil in China, and sold. But I think what the authorities have suggested [is] that there will not be any sharp policy response,' Kowalczyk said. 'Demand for oil will continue to be very strong,' .
He said the difference in the prices of the Brent and the New York contracts would narrow as US refineries stepped up production.
Dealers are watching gasoline stocks closely before the US summer driving starts next month. That is when many Americans take to the road for their holidays.
The refining news offset data published Wednesday by the US Department of Energy that show US gasoline reserves fell by 2.7 mln barrels last week, dropping for the 10th consecutive week. It was a heavier fall than the forecast drop of 1.9 mln barrels.
© 2007 AFX News
