Oil stays below US$88 as Egypt concerns wane


SINGAPORE, Oil prices hovered below US$88 a barrel Tuesday in Asia as fears ease that protests in Egypt could disrupt Middle East crude supplies. Benchmark crude for March delivery was up 11 cents at US$87.59 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell US$1.55 to settle at US$87.48 on Monday. In London, Brent crude rose 40 cents to US$99.65 per barrel on the ICE Futures exchange. Oil jumped above US$92 to a 26-month high last week as violent clashes between supporters and opponents of Egyptian President Hosni Mubarak raised concern shipping through the Suez Canal — a major transit point for crude oil and cargo — could be affected. However, so far the political crisis has not affected crude supplies, and as the violence has waned this week, crude prices have slid back below US$90. In other Nymex trading in February contracts, heating oil rose 0.8 cent to US$2.71 a gallon and gasoline gained 1.4 cent to US$2.64 a gallon. Natural gas futures for March delivery were up 1.1 cents at US$4.12 per 1,000 cubic feet. Traders will also be watching closely the latest U.S. crude inventory figures this week for insight into the strength of demand for oil. The American Petroleum Institute is scheduled to announce its supply data later Tuesday while the Energy Department’s Energy Information Administration reports Wednesday.

“Improvement on virtually every economic front except the housing market has generally been surprising on the bullish side during recent months,” Ritterbusch and Associates said in a report.