SINGAPORE : Oil prices rose towards 71 dollars a barrel in Asian trade on Thursday but sentiment remained weak as investors eyed the debt crisis in Europe, analysts said.
New York’s main contract, light sweet crude for delivery in June, gained 1.09 dollars to 70.96 dollars a barrel. The contract will expire later Thursday.
Brent North Sea crude for July delivery was up 37 cents to 74.06 dollars.
“The June contract has been moved around because of the pre-expiry positioning and that was affected by a number of factors,” said David Moore, a Sydney-based commodity strategist with the Commonwealth Bank of Australia.
“It’s certainly premature to say that the (price) increases represent a turning point for oil at this point. The market remains very volatile and the outlook for oil prices in the very near term is still pretty uncertain,” he told AFP.
Prices moved higher in US trade Wednesday after briefly dropping to their lowest level in more than seven months when it hit 67.90 dollars as the euro fell against the dollar on worries over the eurozone debt crisis.
A stronger greenback makes dollar-priced crude more expensive for buyers using weaker currencies, denting demand, which leads to lower oil prices.
The market was later boosted by a positive growth forecast from the Federal Reserve Wednesday and a report which showed a drop in some US energy stockpiles, signaling greater demand in the largest energy consuming nation.
However, Moore said for the near term, investors would continue to focus on the “developments in Europe and what they mean for the international economic outlook”, rather than the market’s demand and supply balance.
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