SINGAPORE: Oil rose in Asia Wednesday as traders monitored developments in the oil-rich Middle East and North Africa, where political unrest has rocked governments in the past few months, analysts said.
"Within the context of the multiplicity of large economic and political objects that are currently in motion, in our view, it is not too early to think in terms of 2011 becoming an important watershed year," Barclays Capital said in a report.
New York's main contract, light sweet crude for delivery in June rose 83 cents to $109.11 a barrel, while Brent North Sea crude for June gained 60 cents to $121.93 in the afternoon.
In the longer-term, the impact on demand from escalating crude prices remains a concern, Barclays Capital said.
"Crucially, with forecasts so dominated by the pace of demand growth in coming years, it does start to raise the question of how demand will react to higher prices and which is the key driver of the market," it said.
Markets fell Monday after the bearish Standard & Poor's report downgraded the US's credit rating outlook to negative in an unprecedented move, raising doubts about Washington's ability to tackle its huge debt and fiscal deficits.
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