Singapore, Oct 17 (AFP) Oil prices extended a minor rally on bargain-buying today, a day after the US benchmark fell below USD 80 for the first time in more than two years.
However, the overall mood remained clouded by a supply glut in and concerns over demand caused by a slowdown in major European economies and China.
West Texas Intermediate (WTI) for delivery in November was up 60 cents at USD 83.30 a barrel in late-morning trade and Brent rose 74 cents to USD 86.56.
WTI tumbled briefly below the psychological support level of USD 80 in New York yesterday before a mixed crude inventory report spurred a rally.
The report by the US Department of Energy showed a 4.0 million barrel drop in gasoline inventories, much more than analysts had projected, indicating stronger-than-expected demand in the world’s biggest economy.
But the report also showed a build of 8.9 million barrels in crude stocks, much more than the 2.2 million projected.
Desmond Chua, market analyst at CMC Markets in Singapore, said buying sentiment kicked in after traders felt that “the sell-off (in oil) was a tad overdone”.
But analysts expect any advance to be limited, given the current high level of crude supplies and dwindling global demand, with key producers such as Saudi Arabia slashing prices to gain market share while maintaining output. (AFP)
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