High US Crude Supplies Lead to Low Oil Prices in Asia

The recent oil prices in Asia stayed below $102 following a report that shows higher than expected levels of crude supplies in the United States for the third week, which suggests that demand stays weak.

The latest benchmark oil prices for delivery in May was higher by 49 cents to a oil price per barrel of $101.51 in the NYMEX electronic trading. That rate dropped by $1.44 to finish at $101.02.

In London, Brent crude for delivery in May was higher by 20 cents at a per barrel oil price of $120.08.

According to the American Petroleum Institute, crude supplies increased by 6.6 million barrels during the previous week while the survey of Platts’ analysts predicted a rise of 1.8 million barrels.

Gasoline inventories increased to 1.2 million barrels during the past week while distillates fell to 500,000 barrels, said the API.

The Energy Information Administration of the Energy Department reports its supply data per week.

A sell-off in the global stock market that lasts for five days has also damaged positivity among oil traders who always look at equity markets to weigh the overall sentiment of investors. The latest industrial average of Dow Jones fell by 1.7%, and a majority of Asia’s stock markets fell.

Several analysts anticipate short term  crude oil price history to reverse the latest drop from $110 during the previous month, as increasing demand for crude in developing nations tightens supplies globally. Goldman Sachs recommends investors to purchase the crude futures contract of the U.S. for September.

Goldman Sachs stated in a report that they expect the overall crude market to tighten continuously in 2012 and push oil prices to a significantly higher level to control demand.

In other energy trading, prices of heating oil was higher by 0.3 cent at a per gallon cost of $3.10 and gasoline prices declined by 0.5 cents to a per gallon rate of $3.24. Prices of natural gas rose by 1.1 cents to $2.04 for every 1,000 cubic feet.