Oil prices rise despite low demand concerns
Monday, 7 September 2009 17:53Oil prices rose this evening but further gains may be capped by worries about low energy demand in the US, the world's biggest energy consuming nation.
New York's main contract, light sweet crude for October delivery, rose 70 cents to $68.72 a barrel. Brent North Sea crude for October climbed 86 cents to $67.68.
The latest US jobs data released on Friday, which showed a jump in the unemployment rate, was a reminder that energy demand would likely remain weak in the US.
The US unemployment rate climbed to 9.7% with 216,000 jobs lost in August from 9.4% and a revised 276,000 jobs lost in July. Most analysts had expected 230,000 job losses and an unemployment rate of 9.5% in August.
The US, in recession since December 2007, is seen as key to lifting global oil demand, which has been hit by the worldwide economic slump.
Meanwhile, analysts expect the Organisation of the Petroleum Exporting Countries (OPEC) to stick to its production quotas when oil ministers from the cartel meet on Wednesday in Vienna.
OPEC, whose 12 members pump 40% of the world's oil, agreed in 2008 to remove 4.2 million barrels of daily output from the market as it sought to prop up crumbling prices but some countries are believed to have been producing above quota.
On the supply side, Norwegian energy group StatoilHydro and Sweden's Lundin made new discoveries of oil and gas off the coast of Norway, the Petroleum Directorate said today.
The Norwegian giant estimates the find amounts to between 13 and 31 million barrels of oil and between one and two billion cubic metres of natural gas.
