Oil prices mixed in Asian trade
US benchmark West Texas Intermediate (WTI) for June delivery gained ten cents to $59.53 while Brent crude for July eased eight cents to $66.19 in afternoon trade.
Bernard Aw, market strategist at IG Markets Singapore, said the fundamentals of “global oversupply with weak demand” continue to put a cap on prices despite geopolitical unrest raising concerns about a disruption in the Middle East.
He said the crude market is already “used to” unrest in the region, where Islamic State group fighters on Sunday captured the key Iraqi city of Ramadi.
Yemen is also engulfed in violence that analysts fear could escalate and draw in neighbouring Saudi Arabia and Iran, which are backing the warring factions.
Yemen is not a major oil-producing country, but its coast forms one side of the Bab el-Mandeb Strait, the key strategic entry point into the Red Sea through which some 4.7 million barrels of oil pass each day on ships headed to or from the Suez Canal.
Singapore-based Phillip Futures said in a commentary that the crude market “seems to be waiting for stronger fundamentals before prices move higher”.