Oil rebounds in Asian trade

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Singapore, May 20: Oil rebounded in Asian trade on Friday, May 20, as traders bought cheaper crude after prices fell sharply the previous day, analysts said.

New York's main contract, light sweet crude for Jul delivery, advanced 38 cents to USD 99.31 a barrel, while Brent North Sea crude for Jul delivery gained 13 cents to USD 111.55.

"Oil prices are edging up in huge part because some traders think this is a buying opportunity," said Victor Shum, a Singapore-based analyst at Purvin and Gertz international energy consultancy.

Crude sank on Thursday, May 19, after the International Energy Agency warned high prices could derail global economic growth and called for increased output from oil producers to tackle the problem.

The Paris-based IEA said surging prices were "affecting the economic recovery by widening global imbalances, reducing household and business income, and placing upward pressure on inflation and interest rates."

Shum said the New York benchmark crude futures contract is likely to hover around USD 100 in the near term.

Traders are still monitoring the political situation in the Middle East and North Africa, where uprisings have already toppled the leaders of Tunisia and Egypt and unrest has spread to other parts of the oil-producing region.

AFP

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