Oil prices continue topsy-turvy, down in Asia

Oil prices continue topsy-turvy, down in Asia

Thursday, October 30, 2014 6:40 am

Oil prices edged lower in Asia Thursday but losses were limited by a surprisingly upbeat assessment of the US economy by the Federal Reserve, analysts said.

US benchmark West Texas Intermediate (WTI) for December delivery eased 30 cents to $81.90 while Brent crude for December fell 23 cents to $86.89 in afternoon trade.

“Crude oil found some support following a more bullish-than-expected outlook of the US economy by the Federal Reserve,” Desmond Chua, market analyst at CMC Markets in Singapore, told AFP.

The Fed’s policy statement, issued Wednesday after a two-day meeting, cited improving labour market conditions and expressed little concern about low inflation, elements that led analysts to characterise it as more hawkish than expected.

As expected, the central bank wound up its quantitative easing stimulus programme while keeping in place plans to maintain ultra-low interest rates well into 2015.

Daniel Ang, investment analyst at Phillip Futures in Singapore, said investors also had an eye on the latest US supply report Wednesday, which showed crude reserves rose 2.1 million barrels in the week ended October 24.

The figure was less than analysts’ consensus estimate of a 3.1 million barrel surge.

But Ang said that while the inventories rise was smaller than expected it still does not alleviate the oversupply situation in the US.

Singapore’s United Overseas Bank said dealers will next be scrutinising US advance third-quarter gross domestic data to be released later Thursday.

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