Oil prices up in Asian trade

Oil prices edged up in Asia Thursday following
signs of a slight improvement in US demand but
concerns that an oversupply will persist past next
year kept the the commodity struggling at multi-
year lows.
Analysts said a sharp fall in the dollar on
Wednesday may also have spurred some buying
as weakness in the US currency makes dollar-
priced oil cheaper.
But analysts also noted that the unit will likely to
gather strength before a Fed meeting next week
in which the US central bank is widely expected
to raise interest rates.
US benchmark West Texas Intermediate for
delivery in January was up 26 cents at $37.42 and
Brent crude for January was trading 43 cents
higher at $40.54 at around 0700 GMT.
Prices have slumped about nine percent since
Friday’s decision by the OPEC oil exporters club
not to cut output despite pumping more than its
target in the face of a global oversupply and
weakness in the world economy.
There was some good news when the Department
of Energy said Wednesday US oil inventories fell
3.6 million barrels in the week ending December
4, a booster for prices as it indicates an uptick in
demand.
However, Sanjeev Gupta, who heads the Asia
Pacific oil and gas practice at professional
services firm EY, said: “The market remains weak
overall due to global oversupply, compounded by
the OPEC’s decision to leave its production quota
unchanged.
“Investors will closely monitor the Federal
Reserve’s policy-making meeting next week as
dollar-dominated commodities will become more
expensive if US dollar appreciates,” he said.
In a market commentary on Thursday, BMI
Research said it expects prices to remain range-
bound as the oil glut “persists to 2018”.