Oil prices fall in Asian trade

World oil prices fell in Asian trade today on worries of a supply glut amid weak demand after the latest US data showed a rise in the country's energy stocks, analysts said.

New York's main contract, light sweet crude for February delivery shed 38 cents to $36.90 a barrel on the New York Mercantile Exchange.

Brent North Sea crude for February delivery dropped 28 cents to $44.80.

"Weak demand is still overpowering supply in the oil markets," said Jonathan Kornafel, a Singapore-based director with Hudson Capital Energy trading firm.

He was referring to the latest energy data released yesterday by the US government which showed crude reserves rising 1.2 million barrels in the week ending January 9.

Distillates, which include heating fuel and diesel, increased by 6.4 million barrels.

"This week's stats clearly go to the bears," said Morgan Stanley Research, adding the data highlighted "the tension in the market between bulls looking to OPEC cuts and bears pointing to collapsing demand."

Since September, the Organisation of the Petroleum Exporting Countries has cut a total of 4.2 million barrels per day from its production to address the fall in crude oil prices.

Kornafel said it would probably take five to six months for the market to feel the impact of the OPEC production cuts.

Prices have slumped since hitting record peaks above $147 per barrel last July as the ongoing global economic crisis, which has sent major economies into recession, hurt energy demand.