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Oil Prices Drop In Asia

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SINGAPORE, Sept 12, 2014 (AFP) -Oil prices fell in Asia Friday after the International Energy Agency slashed its forecast for world crude demand this year and as dealers await key US economic data, analysts said.

US benchmark West Texas Intermediate (WTI) for October delivery was down one cent to US$92.82 while Brent crude for October eased 29 cents to US$97.79 in late-morning trade.

Both WTI and Brent traded at multi-month lows Thursday before bouncing back to close higher. WTI closed US$1.16 higher in New York while Brent gained four cents in London.

Singapore’s United Overseas Bank said oil prices were under pressure due to the bearish outlook for global demand growth by the IEA.

The IEA, which advises on energy policy to industrialised nations, said Thursday that crude demand will likely grow 1.0 per cent this year, or 900,000 barrels per day, down from a previous estimate of 1.0 million barrels a day.

It said the slowdown was due to “ongoing weakness in both European and Chinese economies, coupled with lower-than expected oil deliveries in Japan and Brazil”.

Analysts said dealers are also awaiting the latest US economic data for fresh trading cues.

US retail sales data for August as well as the University of Michigan consumer sentiment index for September will be released later Friday.

The Ukraine conflict continues to be closely watched by crude investors.

Western nations on Thursday hit Russia with new sanctions for its role in the months-long conflict in eastern Ukraine, raising the ante in the worst East-West crisis since the end of the Cold War.

Russia, accused of supporting armed rebels in eastern Ukraine, is the world’s number-two oil producer, while Ukraine is a key conduit for Moscow’s natural gas exports to Europe.– AFP

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