Oil prices ease in Asian trade, hovering near 53 dollars

Oil prices fell in Asian trade Wednesday after rising to four-month highs on hopes of a US economic recovery, analysts said.

New York's main futures contract, light sweet crude for delivery in May, shed 71 cents to 53.27 dollars a barrel in the afternoon after closing at 53.98 on Tuesday.

Brent North Sea crude for May delivery retreated 82 cents to 52.68 dollars.

Monetary measures to be implemented by the US government to clear banks of toxic assets were raising market sentiment, analysts said.

"We believe commodities are the asset class most likely to benefit from this monetary expansion," said Rod Smyth, a strategist at Riverfront Investment Group, in a note to clients.

"If the stimulus works and economic demand recovers, economically sensitive commodities like oil and industrial metals will benefit."

The US Treasury unveiled a long-awaited plan Monday to buy up toxic assets clogging the financial system by using government funds, loans to investors and guarantees intended to attract private capital.

However, another analyst cautioned against celebrating prematurely.

"While the markets have seemingly cast an assenting vote, and investors appear cheered that the worst may be over, there is a lot that can still go wrong," John Kilduff at MF Global said.

Source: AFP

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