Oil mixed in Asian trade

SINGAPORE, Dec 14, 2009 (AFP) - Oil was mixed in Asian trade Monday with a strong dollar and US demand concerns the main factors influencing investor sentiment, analysts said.

New York's main contract, light sweet crude for January delivery, was down 28 cents to 69.59 dollars a barrel.

Brent North Sea crude for January delivery rose 23 cents to 72.11 dollars a barrel.

"Oil is under pressure because of worries about the strength of the US dollar," said Victor Shum, a Singapore-based analyst with energy consultancy Purvin and Gertz.

"Although the dollar has weakened this morning, the trend over recent days was a strengthening dollar," he said.

In Asian trade Monday, the dollar fell to 88.67 yen from 89.08 in late US trade Friday while the euro changed hands at 1.4677 dollars from 1.4613.

The anticipation of a rate hike spurred the dollar higher in recent days as investors sought better yields, making dollar-priced oil more expensive to buyers using other currencies.

"I do think the dollar will remain a leading driver of oil (in the near-term)," said Shum.

Existing worries over sluggish US energy demand was also another factor undermining oil futures, he said.

"US demand is weak, that is adding to the weight on oil."

The US is the world's largest oil user but demand has been affected by the country's worst economic slump since the Great Depression.

Source: AFP

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