Oil prices down in Asian trade on profit-taking

SINGAPORE – Oil dipped in Asian trade Monday as traders locked in profits after gains last week, analysts said.

New York’s main contract, light sweet crude for delivery in May fell 70 cents to $108.96 a barrel.

Brent North Sea crude for June eased 42 cents to $123.03.

“After three days of gains, markets are looking to lock in some of the profits,” Ong Yi Ling, an investment analyst for Phillip Futures in Singapore, told AFP, with a weaker dollar also supporting prices.

As oil is priced in dollars, a weaker greenback makes it cheaper for holders of stronger currencies, perking up demand and helping push prices higher.

“The dollar could still be weak because of the easing monetary policy by the Federal Reserve,” Ong told AFP.

The market is also monitoring events in the Libya and other parts of the Middle East and North Africa for their possible impact on oil supplies, other analysts said.

In Libya, forces loyal to dictator Moammar Gadhafi bombarded rebels west of Ajdabiya on Sunday, forcing hundreds of residents and some fighters to flee the crossroads town, as a refugee rescue operation in the city of Misrata loomed.

The intense pounding of Ajdabiya came a day after at least eight people were killed and 27 wounded as pro- Gadhafi forces fired rockets at rebel positions there.

An assurance by Saudi Arabia, the world’s largest oil exporter, that it was ready to supply crude as demanded by customers was unlikely to calm down prices, analysts said.

“Saudi Arabia will supply whatever customers ask for,” Saudi Oil Minister Ali al-Naimi told reporters on arrival in Kuwait on Sunday to attend an Asian energy ministers’ meeting.

But he acknowledged that the kingdom’s oil output fell to 8.29 million barrels per day in March from as high as 9.1 million bpd the previous month.

The minister declined to comment on what is a “fair” price for oil.