Oil prices extend rebound in Asia
Agence France-Presse
First Posted 11:50:00 10/01/2008
Filed Under: Economy, Business & Finance
SINGAPORE -- Oil prices extended their gains in Asian trade Wednesday on hopes the US Congress will approve a revised $700-billion package to bail out the distressed financial market, dealers said.
Global stocks plunged Monday after the US House of Representatives rejected the rescue plan, touted by President George W. Bush as critical to avert an economic crisis in the world's biggest economy.
In morning trade, New York's main contract, light sweet crude for November delivery, was up 71 cents to $101.35 a barrel.
It jumped $4.27 to close at $100.64 a barrel in US floor trading Tuesday after plunging $10.52 on Monday after the House of Representatives defeated the bailout.
Brent North Sea crude for November rose 68 cents to $98.85. It had also risen $4.19 to settle at $98.17 in London trade Tuesday after tumbling $9.56 the day before.
"The market is hoping that the US Congress will pass the revised rescue plan," said Ken Hasegawa, energy department manager at Newedge Japan Brokerage in Tokyo.
"I think it will be passed within this week. It's a stabilizer for the market."
The rescue plan proposed the purchase of up to $700 billion worth of tainted mortgage-related assets at the root of a crisis in the US financial market that has sent shockwaves across the world.
Analysts have said the collapse of the plan further heightened worries of an accelerated slowdown in the already-weak US economy, a major buyer of the world's exports.
Congress has taken a two-day holiday, marking the Jewish New Year holiday Rosh Hashanah.
Top Democratic and Republican leaders had consulted one another and White House officials on Tuesday in a bid to ensure the bill's eventual approval.
Democratic speaker Nancy Pelosi and the top Senate Democrat Harry Reid told Bush in a letter that they would keep working with him to revive the bill.
"The longer it takes lawmakers to address the crisis, that much more stress will be freighted by belabored institutions and the machinations of an increasingly exhausted market, making the prospects of eventual success less and less," said John Kilduff, analyst at MF Global.
"We only hope legislators and policymakers recognize this."
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