Oil prices build on gains in Asian trade

Tuesday, 7 December 2010 00:01 - - {{hitsCtrl.values.hits}}

SINGAPORE, (AFP) - Oil prices were higher in Asian trade on Monday as crude markets continued their rally after hitting the highest levels in more than two years on Friday, analysts said.

New York’s main contract, light sweet crude for January delivery, gained 19 cents to 89.38 dollars a barrel in the afternoon after closing at 89.19 dollars on Friday, its highest since October 9, 2008.

Brent North Sea crude for delivery in January advanced 20 cents to 91.62 dollars after it also hit two-year highs on Friday.

“It’s really momentum from last Friday carrying forward to trading this morning,” said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.

Oil prices surged Friday as traders largely ignored deeply disappointing US employment numbers in favour of a slumping US dollar.

A weak greenback makes dollar-traded commodities more attractive for investors.

Shum added that oil markets were also cheered by strong energy demand fuelled by a cold snap in Europe that was only just beginning to ease.

“It’s really the optimism in the market about the fuel demand,” he told AFP.