Oil prices down in Asian trade

INQUIRER FILE PHOTO

SINGAPORE – Oil prices edged lower in subdued Asian trade Monday but retained support from concerns about a crisis in Libya as well as an upbeat demand outlook in the US, analysts said.

The US benchmark, West Texas Intermediate (WTI) for delivery in July, fell 26 cents to $104.09 per barrel in mid-morning trade. Brent North Sea crude for July delivery dropped 26 cents to $110.26.

Singapore’s United Overseas Bank said “trading action may be limited” with financial markets in the United States and Britain closed for public holidays.

“European geo-political concerns and signs of improving US crude demand” provided a lift to prices, it said in a note to investors.

Traders are closely watching the situation in Ukraine, where chocolate baron Petro Poroshenko on Sunday claimed a resounding victory in the country’s key presidential election.

The polls were triggered after former pro-Russian leader Viktor Yanukovych was ousted in February.

Poroshenko immediately vowed to end a bloody pro-Russian uprising that thwarted voting across swathes of the separatist east.

Washington and its European allies supporting Ukraine’s Western-friendly government have accused Russia of fomenting unrest in the country’s east, allegations Moscow denies.

A full-blown armed conflict in the ex-Soviet state – a major conduit for Russia’s gas exports to Europe –could disrupt supplies and send energy prices rocketing, analysts say.

Prices have been propped up by fears of a supply disruption in OPEC member Libya, where escalating lawlessness has been aggravated by power struggles between politicians and militias.

Upbeat sentiment about demand in the US following a bullish crude stockpiles report last week also lent support, analysts said.