SINGAPORE: Oil prices eased in Asian trade Thursday following a rally in the previous session, analysts said.
The US benchmark, West Texas Intermediate for June delivery, was down 27 cents at $102.10 a barrel in afternoon trade while Brent North Sea crude for June dropped 11 cents to $110.08.
Prices climbed in US trade Wednesday after a Department of Energy report showed a drawdown at the Cushing, Oklahoma, terminal that fuelled hopes demand had picked up in the world’s biggest oil consuming nation.
However, Michael McCarthy, chief market strategist at CMC Markets, in Sydney told AFP: “There are concerns that the spike is due to changes in the distribution structure rather than an increase in demand.”
He said the drop at Cushing was due to better distribution through the southern leg of the Keystone XL pipeline, which transports oil to Gulf Coast refineries in Texas.
The overall US crude oil stockpiles data — which includes those outside Cushing — showed supplies rising 900,000 barrels in the week ending May 9.
However, the fall in prices has been tempered by the ongoing crisis in Ukraine, with Russian Foreign Minister Sergei Lavrov saying on Wednesday that the former Soviet state was on the brink of civil war.
Ukraine is a major conduit for Russian oil and gas exports to Western Europe, and analysts fear that an escalation of the conflict could disrupt supplies and send prices soaring. AFP