Crude down in Asia on US inventory gain

Singapore – Crude was down in Asia Thursday as a sharper-than-expected US stockpile gain further spooked nervous investors already shaken by worries over the eurozone, analysts said.

New York’s main contract, light sweet crude for delivery in June, dipped eight cents to $96.73 per barrel and Brent North Sea crude for June delivery shed four cents to $113.16.

“Election results in France and Greece, and the fall of the Dutch government, bode ill for the eurozone, said Sanjeev Gupta, who heads the Asia-Pacific Oil and Gas practice at Ernst & Young.

“Oil supplies have remained ample… (and) US oil inventories increased again,” he told AFP.

Data released by the US Energy Information Administration late Wednesday showed crude inventories rising by 3.65 million barrels last week, higher than analyst expectations of a two million gain.

This indicates weakening energy demand in the world’s largest oil consumer, which is bearish for oil markets.

Electoral triumphs for French and Greek political parties championing anti-austerity measures raised new doubts about the eurozone’s ability to decisively resolve its debt woes.

Of particular concern is Greece, said Justin Harper, market strategist for IG Markets Singapore.

“Investors continue to be spooked by fears that a newly formed Greek parliament will decide to renege on its debt repayments, leave the euro and start a chain reaction among peripheral economies,” he said in a report.