Oil prices steady after surge

November 12, 2010 | 14:51

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Crude oil prices held in a narrow range on Thursday after surging in recent days as traders locked in profits despite predictions of stronger demand.

New York's main contract, light sweet crude for December, ended at $87.81 a barrel, unchanged from the day before.

London's Brent North Sea crude for delivery in December stood at $88.81, down 15 cents compared with Wednesday's close after touching two year highs.

Prices have been buoyed in recent weeks by a weaker dollar, and the prospect of a stronger-than-expected global economic recovery.

"Both on the demand side and on the currency side, there have been expectations of higher moves in price," said Jason Schenker of Prestige Economics.

Schenker added that there was some "profit taking when we got those highs," easing the rally.

That largely canceled out news from the Organization of Petroleum Exporting Countries which pointed to increased demand.

OPEC on Thursday revised upward its world oil demand growth estimates for this year and next amid cautious optimism about the global economic outlook.

OPEC said it was penciling in world oil demand growth of 1.3 million barrels a day for 2010, compared, up 190,000 barrels from its previous estimate.

"Despite initial economic assessments that underestimated the second half of the year's economic activities, oil demand is picking up in the third and fourth quarters," OPEC wrote.

The report came one day after official data showed crude stockpiles in the United States, the world's biggest oil consumer, eased 3.3 million barrels in the week ending November 5, compared with forecasts of a rise.

AFP

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