Oil prices up in Asia amid volatile trading| MENAFN.COM

Tuesday, 28 June 2022 08:47 GMT

Oil prices up in Asia amid volatile trading

(MENAFN- AFP) Oil prices rose in Asia Friday as dealers digested a mixed US inventory report and a new round of interest rate cuts by the European Central Bank, while keeping watch on the Ukraine conflict.

US benchmark West Texas Intermediate for October delivery gained 31 cents to $94.76 while Brent crude for October delivery was up 27 cents at $102.10 in late-afternoon trade.

Sanjeev Gupta, head of the Asia-Pacific oil and gas practice at business consultancy EY, said oil prices were "see-sawing" as dealers tracked simultaneous upside and downside factors.

US crude reserves in the United States in the week to August 29 fell 900,000 barrels, the Energy Information Administration said Thursday, close to analysts' expectations.

However, a 0.2 percentage point drop in refinery usage to 93.3 percent of total capacity signalled tepid demand in the world's top crude consumer after the end of the summer driving season.

The European Central Bank's (ECB) surprise move on Thursday to introduce a new round of interest rate cuts "boosted the US dollar and capped the gains of benchmark oil prices", Gupta said.

An advance in the greenback makes dollar-priced oil and commodities more expensive for buyers using weaker currencies, denting demand and pushing prices lower.

Elsewhere, signs of a resolution to the months-long Ukraine crisis is providing support to oil prices, analysts said, with hopes that the end of fighting will result in resurgent energy demand.

Ukraine President Petro Poroshenko on Thursday voiced "careful optimism" that peace talks on the conflict with pro-Kremlin rebels would produce a ceasefire in a civil war that has cost some 2,600 lives.

Western leaders gathered in Britain for a NATO summit kept up pressure on Russia for its support of the rebels and warned of more sanctions against Moscow despite the possibility of a ceasefire deal.

The conflict is closely watched by crude investors as Russia is the number-two oil producer in the world, and Ukraine is a key conduit for Moscow's gas exports to Europe.

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