SINGAPORE: Crude oil futures edged up on Monday, buoyed by healthy Asian appetite and demand from the U.S. driving season.
Front-month Brent crude prices had gained 2 cents to $65.39 per barrel by 0312 GMT. U.S. crude prices were up 14 cents at $59.86 a barrel.
“Global oil demand continues to surprise to the upside, with April data showing no signs of slowdown despite a pick-up in prices,” Energy Aspects said.
Japan’s customs-cleared crude oil imports rose 9.1 percent to 3.62 million barrels per day (17.28 million kilolitres) in April from the same month a year earlier, the Ministry of Finance said on Monday.
In China, crude imports hit a record 7.4 million barrels per day in April despite a slowing economy, driven largely by healthy car sales.
“We expect Chinese imports to be high in H2 15, potentially averaging 7.5 million barrels per day.
This is due to the start-up of 39 mb (million barrels) of commercial storage, five SPR (strategic petroleum reserve) sites and linefill for Kunming refinery buying for which is ongoing we believe, even though the refinery won’t start up till early 2016,” Energy Aspects said.
In the United States, the peak summer driving season officially starts with Memorial Day on Monday, and the American Automobile Association said road travel was expected to reach a 10-year high over the Memorial Day weekend, suggesting strong fuel consumption over the next three days.
In oil exporting Libya, warplanes from the official government attacked an oil tanker docked outside the city of Sirte on Sunday, wounding three people and setting the ship on fire, officials said.
It was the third confirmed strike by the internationally recognised government on oil tankers, part of a conflict between competing administrations and parliaments allied to armed factions fighting for control of the country four years after the ousting of Muammar Gaddafi.
Analysts said that steeper increases in oil prices were prevented by weak overall fundamentals.
“The overall fundamentals still point to a well-supplied market, a fact that should continue to put a ceiling on prices,” Barclays said.
Singapore-based Phillip Futures said that it expected WTI and Brent July 2015 contracts to remain above $58.49 and $64.35 respectively, provided oil fundamentals do not change.