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Crude oil prices eased in Asian trade today as investors locked in profits after recent sharp gains while keeping a close eye on international tensions over Russia’s annexation of Ukraine’s Crimea region.
New York’s main contract, West Texas Intermediate (WTI) for April delivery, was down 34 cents to $99.36 in mid-morning trade, and Brent North Sea crude dropped 16 cents to $106.63 for its May contract.
WTI jumped $1.62, or 1.7 per cent, in US closing trade yesterday on news of a key pipeline expansion that will help to draw down bulging crude supplies at the country’s Cushing depot in Oklahoma.
Desmond Chua, market strategist at CMC Markets in Singapore said “we are still due for more rising tensions in terms of follow-up actions from Russia” in its showdown with the West over Ukraine’s strategic Crimea peninsula.
More than 70 per cent of Russia’s oil and gas exports to Europe pass through Ukraine and there are concerns that Western sanctions on Moscow could lead to a disruption of supplies.
President Vladimir Putin yesterday signed a treaty claiming Crimea as Russian territory, as Ukraine warned the showdown had entered a “military stage” after soldiers were killed on both sides.
Meanwhile, investors are also keeping an eye on the outcome of the US Federal Reserve’s two-day policy meeting that ends later today.
The US central bank is expected to further cut its massive stimulus programme amid a slowly recovering economy in the world’s largest crude-oil consuming nation.
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