Oil mixed in Asian trade

SINGAPORE, July 14 (BSS/AFP) - Oil was mixed in Asian trade today as a larger-than-expected fall in crude stockpiles underscored strong energy demand in the United States, the world's biggest economy.

Price gains, however, were being limited by concerns over
the debt crisis in the eurozone, analysts said.

New York's main contract, West Texas Intermediate for
delivery in August, was down one cent to $98.04 a barrel in
morning trade.

Brent North Sea crude for August delivery rose 14 cents to
$118.92.

"The US oil inventories report showed a larger-than-expected
stock drawdown for the sixth consecutive week," said Victor Shum,
an analyst with Purvin and Gertz energy consultancy in Singapore.

He said this indicated that "US oil demand remains quite
strong despite the high unemployment situation."

The US Department of Energy reported that crude inventories
dropped by 3.1 million barrels last week, more than double the
amount expected by analysts.

Additionally, petrol inventories fell by 800,000 barrels,
reflecting heavy usage over the July 4 Independence Day weekend,
one of the busiest periods of the US summer driving season.

US energy consumption is being closely monitored by the
market because it is the world's biggest economy and oil
consumer.

Meanwhile, the Paris-based International Energy Agency
warned that the oil market needed more supplies for the third
quarter of 2011, despite increased OPEC production and its own
emergency stock release last month.

"We welcome rising OPEC volumes seen in June, but the market
needs still more oil," the IEA said in a monthly report,
describing global oil demand as "robust".

On June 23, the IEA authorised an emergency drawdown of its
member nations' strategic oil stockpiles to replace lost output
from Libya and to give the global economy relief from soaring
energy prices.

Oil prices have rebounded since then and are now above the
levels they were at prior to the IEA's announcement, but the
European debt crisis is dampening sentiment.

"The European debt crisis concerns remains one factor
limiting further gains in oil futures," Shum said.

Posted in: Oil mixed in Asian trade