Oil headed up in Asian trade today, tracking gains on Wall Street as well as Asian bourses and buoyed by a dip in US crude stockpiles, analysts said.New York's main contract, light sweet crude for delivery in August, gained five cents to USD 89.92 a barrel and Brent North Sea crude for September delivery was up 26 cents at USD 105.42.
A Wall Street rally that spilled over to Asia gave oil further momentum after it was supported by data showing a US crude inventory fall, said Victor Shum, senior principal for Purvin and Gertz energy consultants in Singapore.
"The market is reacting to the oil inventory report from the US yesterday. The report shows decreases in both crude oil and gasoline inventories," he told AFP. "The other factor is Wall Street showed substantial gains yesterday and Asian equities this morning are also reacting positively," Shum added.
The US Department of Energy reported that American crude oil inventories sank by 800,000 barrels in the week ending Jul 13. The news was welcomed by traders despite earlier expectations of a larger decline of 1.1 million barrels, according to analysts polled by Dow Jones Newswires.
In the United States, Wall Street climbed for a second straight day Wednesday amid upbeat earnings reports and after the Federal Reserve said the economy continued to grow, at least at a modest pace. The upbeat mood spread into Asia on Thursday, with stocks broadly higher.