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Oil prices up in Asian trade

Oil prices

Singapore:  Oil prices edged higher today following a mixed US petroleum report that showed a healthy decline in crude and gasoline reserves but a rise in oil production that could aggravate the global supply glut.

US benchmark West Texas Intermediate (WTI) for July rose 53 cents to USD 58.21 and Brent crude for July gained 43 cents to USD 63.01 in afternoon trade.

Daniel Ang, investment analyst at Phillip Futures in Singapore, said in a commentary that Thursday’s US Department of Energy petroleum report “showed a mixed sentiment as the bearish production increase was offset by a bullish inventory decrease”.

“As a result of this, we were seeing the bulls and the bears fighting fiercely”.

The report showed US commercial crude inventories fell 2.8 million barrels to 479.4 million in the week through May 22, while gasoline stockpiles fell 3.3 million barrels.

But the DoE also reported a rise in US crude production last week, by 304,000 barrels per day to 9.57 million.

Dealers have been hoping a slowdown in US output, and increased demand during the summer driving season, could whittle down the huge global supplies that were a key reason for the collapse in prices of more than 50 per cent between June 2014 and January this year.

Ang said investors are awaiting the release of the second reading of US first-quarter gross domestic product later today for clues about demand in the world’s biggest economy.

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