Oil prices down in Asia

Influenced by rising US crude stockpiles as traders lament lack of fresh stimulus measures from Fed

I / Singapore June 21, 2012, 10:14 IST

Oil prices fell in Asian trade today on rising US crude stockpiles as traders lamented the lack of fresh stimulus measures from the Federal Reserve, analysts said.

New York's main contract, light sweet crude for August delivery, shed 89 cents to $80.56 a barrel on its first trading day and Brent North Sea crude for delivery in August retreated 58 cents to $92.11.

"The lack of fresh Fed stimulus, the downgrade to the US outlook and an unexpected rise in US inventories took their toll on the price," IG Markets said in a report.

The Fed yesterday announced that it was extending a bond-swap programme.

The plan is designed to push down interest rates on long-term bonds, encouraging investors to move money into more neglected securities and lowering costs for borrowers.

But traders were disappointed that the bank was not releasing a third round of bond purchases, or quantitative easing, to boost growth in the world's largest oil consumer.

The Fed's prediction that US unemployment would remain above eight percent for at least the remainder of this year also contributed to trader gloom.

Crude prices were also pressured by "data show(ing) US crude inventories unexpectedly swelled," Phillip Futures said in a report.

Official data released yesterday showed US crude stockpiles rising by 2.86 million barrels last week against analyst forecasts of a 1.1 million barrel decline.