Oil prices ease in Asian trade

Oil prices ease in Asian trade

Agence France-Presse/Singapore

Crude oil prices eased in Asian trade on Tuesday but stayed above the US$48 mark on expectations of strong demand in the longer term, dealers said.

At 12:13 pm (0413 GMT), the March contract for light sweet crude on the New York Mercantile Exchange was trading at $48.06 per barrel, off a high of $48.24 and a low of $48.05. It was down 14 U.S.cents from its close of $48.20 in New York on Monday.

Oil prices had dipped to as low as $46.05 on Monday in New York as the landmark elections in Iraq proceeded relatively smoothly and OPEC announced it would keep oil production steady in the face of increased cold weather demand during the northern winder.

The 11-nation oil cartel, which supplies nearly a third of the world's oil, indicated, however, that high prices were here to stay and that it may cut output soon.

"What we see here is basically a technical correction, with the long-term outlook bringing the market back to where it is now," said Eswaran Ramasamy, a Singapore-based director of energy information provider Platts.

"With China and India coming into the market in a big way, the demand for crude oil and petroleum looks to be strong for the whole year."

Growing economic powers India and China have emerged among the top consumers of the global oil production and have been competing with each other to clinch contracts and investment stakes with oil-producing nations.

India is able to meet only 30 percent of its oil needs through domestic resources and its appetite for the fuel is expected to keep growing in line with its economy.