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Oil
prices fell from a record high over US$126 a barrel yesterday
as a dip in crude oil imports into the world’s second
biggest consumer China stirred concerns high prices were
eating into demand.
US crude settled down $1.73 at US$124.23 a barrel, off an
earlier record high of US$126.40 a barrel. London Brent
crude settled $2.49 lower at US$122.91 a barrel.
China’s April crude oil imports decreased against year-ago
levels, the first monthly year-on-year decline in 18 months,
although analysts said the dip was a one-off adjustment
as refiners ran down stocks after unusually high March purchases.
“This
looks like a bit of a correction on a vastly overbought
market,” said Mike Zarembski, senior commodities analyst
for optionsXpress. “News that China’s imports
were down in April was a factor for some of the money to
come off the table, but the market is still robust.”
Strength in distillates for power generation globally has
supported crude in recent weeks, and signs demand could
falter helped weaken the energy complex, Zarembski added.
Booming demand in emerging economies such as China and India
have sent oil prices up six-fold since 2002, with the weak
dollar also drawing a wave of speculators seeking a hedge
against inflation.
Oil has jumped about 13 per cent since slipping to US$110.53
a barrel on May 1, as investors seized on supply disruptions
in the North Sea and Nigeria.
Oil’s runaway gains prompted talk last week that the
Organisation of Petroleum Exporting Countries (Opec) could
consider boosting output before its next scheduled meeting
in September should crude oil prices keep rising.
But oil officials from Ecuador, Qatar, the united Arab Emirates
and Iran said there were no plans for an early meeting as
soaring prices were out of Opec’s control.
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