Oil prices were slightly lower in Asian trade on Friday as investors kept an eye on global financial and equity markets shaken by a crisis in United States lending to risky home-loan borrowers, dealers said.
Prices have firmed in recent days after falling sharply from an all-time peak $78,77 on August 1 as the financial markets calmed down, easing concerns about weaker economic growth that would dampen energy demand.
But concerns over a credit squeeze resurfaced on Thursday, indicating that the fall-out from the US subprime mortgage woes were far from over, analysts said.
At 07h30 GMT, New York’s main contract, light sweet crude for October delivery was off five cents to $69,78 a barrel from $69,83 in late US trades Thursday.
Brent North Sea crude for October delivery eased five cents to $69,81.
“Oil markets are weighing potential influences at present, including what, if any, impact the financial market issues of recent weeks may have on US economic growth,” Australia’s Commonwealth Bank said in a note.
The United States is the world’s biggest oil consumer, and an economic slowdown there will hit demand for oil.
The oil market is also watching any decision by the Organisation of the Petroleum Exporting Countries (Opec) cartel during their meeting next month regarding production levels and whether “there is a risk of oil market conditions worsening over the northern winter,” Commonwealth Bank said.
Winter will fuel higher demand for heating fuel.
Many analysts believe Opec will keep production at current levels when it meets on September 11 at its Vienna headquarters. — AFP