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Oil rebounds in Asia

Oil prices

Singapore:  Oil rebounded in Asia today on bargain-hunting after prices plunged a day earlier as Greek defiance against austerity measures imposed by its creditors sparked turbulence in global markets.

Prices rose ahead of an emergency summit on Greece by eurozone leaders in Brussels today, after Greek citizens overwhelmingly rejected creditors’ demands for further belt-tightening in a referendum.

US benchmark West Texas Intermediate for August delivery advanced 47 cents to USD 53.00 in late-morning Asian trade after plummeting nearly 8.0 per cent, or USD 4.43, in US closing deals yesterday.

Brent crude for August gained 69 cents to USD 57.23 after retreating more than 6.0 per cent, or USD 3.78, in London.

“The market is trying to consolidate after the price plunge. People are buying on bargains,” said Daniel Ang, an investment analyst with Phillip Futures in Singapore.

“I’m really looking at this whole issue as panic selling because of the Greece issue. I think the market expected the drops but not to this extent,” he told AFP, referring to Monday’s price fall.

Analysts say one of the results of the Greece referendum could be an exit from the eurozone currency union, which could trigger a contagion effect.

With the country’s economy gasping for air, authorities there extended an eight-day bank closure until Thursday amid fears cash machines in the country were running dry.

Ang said the oil market is also watching ongoing top-level negotiations in Vienna between Western powers and Iran on Tehran’s nuclear ambitions, although indications are that both sides were set to miss yet another deadline today to nail down an agreement.

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