Oil weaker in Asian trade, NY crude above $54 /bl

Oil weakened in Asian trade today after an overnight rally driven by the surge in US equity markets, analysts said.

New York's main contract, light sweet crude for May delivery dropped 29 cents to $54.05 a barrel.

Brent North Sea crude for May delivery was off 21 cents to $53.22.

Crude prices likely ran out of steam amid worries the worst is not over for the US economy, analysts said.

"While the bounce in financials could run on, the broader economy is still in the doldrums and unlikely to turn the corner until next year at the earliest," research house Capital Economics said in a report.

"As such we think the prospects for non-financials remain far from rosy."

Revised data released Thursday showed the US economy shrank 6.3 per cent in the fourth quarter ended December, which was worse than the initial estimate of a 6.2 per cent decline.

The slump was the steepest since 1982 but not as bad as the 6.6 per cent annualised drop expected on average by private forecasters.

Meanwhile, the president of oil-producer United Arab Emirates said in an interview published yesterday that an oil price of $70-75 a barrel would be "fair."