Oil firmer, Brent crude close to $112

20th May 2011, Comments 0 comments

Oil prices recovered some ground on Friday as traders sought bargains following the previous day's sharp losses, analysts said.

Brent North Sea crude for delivery in July gained 43 cents to $111.85 a barrel in London deals.

New York's main contract, light sweet crude for July, advanced 72 cents to $99.16 after shedding $1.66 on Thursday.

"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.

Oil fell on Thursday after the International Energy Agency warned high prices could derail global economic growth and called for increased output from producers to tackle the problem.

The Paris-based IEA said higher 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 contract was likely to hover around $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.

"Continuing unrest in the Middle East and North Africa region is providing support for oil and we expect prices to be hovering around the $100 level in the future," Shum told AFP.

© 2011 AFP

0 Comments To This Article