Oil Prices Ease off in Asia after Hitting New Highs
Oil prices eased slightly in Asia Friday after hitting a series of new highs this week, bolstered by a weak dollar.
The U.S. Federal Reserve held interest rates unchanged after its policy meeting on Wednesday, signalling it was in no hurry to raise rates.
On Thursday, the dollar fell about 3.0 percent against the Japanese yen after the Bank of Japan disappointed markets by not offering additional stimulus measures for the struggling economy.
At about 0625 GMT, U.S. benchmark West Texas Intermediate for June delivery was one cent down at $46.02 while Brent North Sea for June delivery was three cents lower at $48.11.
On Thursday, Brent rose to $48.14 a barrel, its highest price since November, while WTI traded at $46.03 a barrel, its loftiest mark this year.
The slight clawback during early Asian trading hours on Friday could be put to profit taking and normal market fluctuations, said Alex Wijaya, a senior sales trader with CMC Markets in Singapore.
"It used to be that any move from Saudi Arabia could control the market but increasingly, this is less so and we're seeing moves from America, China and even Iran affecting the market," he told Agence France Presse.
With prices edging closer to $50, it is possible that U.S. shale producers might resume drilling again, bringing up production, he said.
"From what I understand, the breakeven point for shale is between $50 to $60, so those drilling now are operating at a loss.
"When prices go up and they resume, we'll have to see whether demand can catch up with supply," Wijaya said.
Source: Agence France Presse
| Copyright © 2012 Naharnet.com. All Rights Reserved. | https://www.naharnet.com/stories/en/208118 |