Oil prices rose in Asia today on bargain-hunting following sharp falls in the previous session triggered by a strong US dollar and continued concerns over global supply glut, analysts said.

US benchmark West Texas Intermediate (WTI) crude for July delivery gained 32 cents to $58.35, while Brent crude for July delivery gained 11 cents to $63.83 in late-morning trade.

WTI fell $1.69 and Brent dipped $1.80 yesterday, as markets in the United States and much of Europe reopened after a public holiday on Monday.

Oil prices have been under pressure on a resurgent dollar, which has strengthened following expectations that the US Federal Reserve will follow through on plans to raise record-low interest rates later this year.

Stronger greenback makes crude more expensive for buyers using weaker currencies.

“As the prices for crude dropped quite sharply last night, the current rebound is due to bargain-hunting as traders pounce at the low prices,” Nicholas Teo, market analyst at CMC Markets in Singapore, told AFP.

Crude stockpiles data

Teo said dealers are also awaiting the latest official US stockpiles report to be released later Wednesday for fresh clues about demand and production levels in the world’s top crude consumer.

Crude reserves likely fell by 1.5 million barrels in the week to May 22, according to a survey by Bloomberg News.

Overall US stockpiles, which stand at 482.2 million barrels, are at the highest level since 1930, according to data compiled by the US Energy Information Administration.

Dealers have been hoping that a slowdown in US output, coupled with increased demand during the summer driving season, could whittle down the build up of global crude reserves which was a key reason for the collapse in prices of more than 50 per cent between June and January.

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