Oil extends losses in Asian trade

SINGAPORE – Oil extended losses in Asian trade Thursday on data showing weak energy demand in the United States, the world’s biggest oil-consuming nation, and persistent fears over the Greek debt crisis.

New York’s main contract, light sweet crude for delivery in October, was down 43 cents to $88.48 in morning trade and Brent North Sea crude for October settlement eased 53 cents to $111.87.

The US Department of Energy said Wednesday US crude oil inventories slipped by 6.7 million barrels last week, but analysts said the plunge was mainly a result of production shut in when tropical storm Lee passed through the Gulf of Mexico.

Investors focused more on gasoline stockpiles, which rose by 1.9 million barrels, indicating weak demand.

“The weaker demand in gasoline is bearish news for crude oil demand,” said Ker Chung Yang, a commodity analyst at Phillip Futures in Singapore.

Other analysts said the market remained encumbered by concerns over Greece’s debt crisis despite statements by France and Germany they were convinced that Athens’ future lay in the eurozone.

Global markets had been in turmoil on rising expectations of a Greek default or even an inglorious exit from the eurozone, stemming from its ongoing troubles to apply a recovery plan by the European Union and International Monetary Fund.

“Markets still need to be convinced that it [Europe] has a credible mechanism to manage the crisis,” DBS Bank said in a market commentary.