Oil prices continue upward trend

LONDON – Oil rose back to near US$94 a barrel on Friday as concerns over tight supplies ahead of the winter returned to the fore.

The market awaited a key US jobs report for clues about the economic health of the world’s top oil consumer. US crude for December gained 49 cents to US$93,98 a barrel by 10h07 GMT, having fallen by US$1,04 on Thursday after striking a record high of US$96,24.Brent crude was up 67 cents to US$90,39, off its record high of US$91,71 from the previous session.”In view of the extreme fundamental tightness we believe that risks in this market remain skewed to the upside,” analysts at Barclays Capital said in a research note.Oil tumbled from record highs on Thursday as traders took profits from oil’s 40 per cent rally since mid-August, built on the back of looming supply tightness, a weak dollar and a flight from riskier assets into commodities as a global credit squeeze riled other markets.”There was some profit-taking and concerns over the impact to the US economy,” said Gerard Rigby from Fuel First Consulting in Sydney.Weakness in the US economy could erode demand growth from the world’s top energy consumer.The market awaited data on US payrolls for October for further clues on how the economy there is faring.Analysts are expecting the report, due later on Friday, to show the economy created 80 000 jobs last month, after an increase of 110 000 jobs in September.Traders said supply worries continued to support prices, and cited comments by the US Energy Information Administration (EIA) about fears of a shortage next year, as well as continued strong demand in Asia.EIA administrator Guy Caruso said that if Opec does not crank up production, markets would be short of oil early next year.The Organisation of the Petroleum Exporting Countries, which supplies more than a third of the world’s oil, rejects any talk of supply tightness and blames speculators, political tensions and a weak dollar for driving up the cost of fuel.Opec, which in September agreed to boost supplies by 500 000 barrels a day from November 1, has resisted consumer calls for more oil.Opec heads of state are due to meet in Riyadh this month.Nampa-ReutersUS crude for December gained 49 cents to US$93,98 a barrel by 10h07 GMT, having fallen by US$1,04 on Thursday after striking a record high of US$96,24.Brent crude was up 67 cents to US$90,39, off its record high of US$91,71 from the previous session.”In view of the extreme fundamental tightness we believe that risks in this market remain skewed to the upside,” analysts at Barclays Capital said in a research note.Oil tumbled from record highs on Thursday as traders took profits from oil’s 40 per cent rally since mid-August, built on the back of looming supply tightness, a weak dollar and a flight from riskier assets into commodities as a global credit squeeze riled other markets.”There was some profit-taking and concerns over the impact to the US economy,” said Gerard Rigby from Fuel First Consulting in Sydney.Weakness in the US economy could erode demand growth from the world’s top energy consumer.The market awaited data on US payrolls for October for further clues on how the economy there is faring.Analysts are expecting the report, due later on Friday, to show the economy created 80 000 jobs last month, after an increase of 110 000 jobs in September.Traders said supply worries continued to support prices, and cited comments by the US Energy Information Administration (EIA) about fears of a shortage next year, as well as continued strong demand in Asia.EIA administrator Guy Caruso said that if Opec does not crank up production, markets would be short of oil early next year.The Organisation of the Petroleum Exporting Countries, which supplies more than a third of the world’s oil, rejects any talk of supply tightness and blames speculators, political tensions and a weak dollar for driving up the cost of fuel.Opec, which in September agreed to boost supplies by 500 000 barrels a day from November 1, has resisted consumer calls for more oil.Opec heads of state are due to meet in Riyadh this month.Nampa-Reuters