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Oil below 78 dollars on profit-taking, weaker stocks

Posted by on Thursday, June 17, 2010, 18:05
This news item was posted in Business category and has 0 Comments so far .

SINGAPORE: Oil prices eased in Asian trade Thursday as stock markets weakened and investors booked profits following a surge above 78 dollars a barrel, analysts said.

New York’s main futures contract, light sweet crude for delivery in July, shed 55 cents to 77.12 dollars a barrel while London’s Brent North Sea crude for August delivery was off 22 cents at 77.92 dollars.

“Oil prices have eased a bit and this is consistent with the movement in equities,” said Victor Shum, a senior principal with the Purvin and Gertz energy consultancy.

“It’s not surprising that we are seeing declines at the same time that we are seeing some easing in

Oil below 78 dollars on profit-taking, weaker stocks
Oil below 78 dollars on profit-taking, weaker stocks

the Japanese Nikkei stock index,” he told AFP.

Japanese stocks opened lower Thursday, with the headline Nikkei index losing 57.90 points or 0.58 percent to 10,009.25 in the first minutes of trading.

Shum said investors were also cashing in profits after oil prices rose for the third day running Wednesday, with the New York contract reaching an intra-day peak of 78.13 dollars, its highest price since May 10.

“Oil pricing has been rallying for the past couple of days in line with the rally in equities and after these gains, investors are inclined to book some profits,” Shum said.

Prices had gained support from a surprise drop in US gasoline inventories, which stoked hopes for rising summer demand in the world’s biggest energy-consuming nation.

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