Crude up for first time in 2 weeks; analysts don't rule out further price drops
The price of oil rose for the first time in two weeks Thursday despite analyst concern that the bottom has yet to be reached amid ample and increasing supplies on world markets.
Benchmark West Texas Intermediate crude for August delivery gained 64 cents to US$102.93 a barrel on the New York Mercantile Exchange.
Brent crude, a benchmark for international oils, rose 54 cents to US$109.01 on the ICE Futures exchange in London.
Oil fell to a two-month intraday low of $101.55 in the morning, but rallied as U.S. equities markets recovered from steep morning losses.
Oil rose earlier this year, partly because worries about a possible threat to supplies from Iraq, the second-largest producer among the Organization of Petroleum Exporting Countries, amid rapid gains by insurgents. Shipments from Libya were also curtail as a result of a dispute between militants and the government.
However, Iraqi concerns have since faded as government forces moved to blunt the insurgent advance and an agreement between the government and militants in Libya promises to sharply increase exports there.
As a result, analysts cautioned that more price declines are possible.
"It is premature to suggest that a bottom has been placed," wrote Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates, in a note to clients.
In other energy futures trading, wholesale gasoline rose two cents to US$2.96 a U.S. gallon (3.79 litres), heating oil added two cents to US$2.89 a gallon and natural gas fell five cents to US$4.12 per 1,000 cubic feet.
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