SINGAPORE: Oil prices rebounded in Asian trade Thursday after plunging overnight on signs of faltering demand in the United States and China, the world's top oil-consuming nations, analysts said.
New York's main contract, light sweet crude for delivery in June, rose 88 cents to $99.09 a barrel in morning trade, while Brent North Sea crude for June delivery gained 93 cents to $113.50.
"We're looking at a rebound after the huge sell-off," said Ong Yi Ling, an investment analyst for Phillip Futures in Singapore.
Prices dived Wednesday amid signs of slowing demand in the US, with the rise in the dollar contributing to the dip as it made dollar-priced crude more expensive.
New York's crude futures benchmark -- the West Texas Intermediate (WTI) -- tumbled 5.5 percent, or $5.67, to settle at $98.21 a barrel on Wednesday, and Brent declined $5.06 to close at $112.57 a barrel.
The WTI came under pressure after the US Department of Energy's latest weekly report on energy reserves, showing another increase in crude stockpiles and an unexpected rise in gasoline reserves in the world's largest oil-consuming nation.
The increase in reserves is a sign of softer demand.
Crude oil stockpiles rose by 3.8 million barrels to 370.3 million in the week ending May 6, the DoE said. The reserves had increased by almost 10 million barrels over the previous two weeks.
Gasoline reserves rose by 1.3 million barrels to 205.8 million, although experts had predicted a decline.
"The unexpected build to gasoline stocks has really hurt the market with signs of demand slowing over the last week," said an analyst at Summit Energy.
Data showing China's inflation rate still well above the government's target also sparked fresh concerns that Beijing will invoke further cooling measures.
This could slow down growth in the world's second-largest economy and affect demand for oil, analysts said.
The OPEC cartel on Wednesday announced its forecast for world oil demand growth was unchanged this year, saying rising consumption in China would make up for the uncertain outlook in the United States and in earthquake-hit Japan.
Prices had risen early this week due to worries that record flooding along the Mississippi River in the United States could affect oil refineries.
Copyright AFP (Agence France-Presse), 2011
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