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Oil rebounds in Asia on bargain-hunting

New York’s main contract, light sweet crude for delivery in June gained 19 cents to $95.36 a barrel and Brent North Sea crude for June delivery was up one cent to $102.83 in the afternoon.

“Oil has rebounded primarily because traders think it is a good buying opportunity,” Victor Shum, managing director of IHS Purvin and Gertz in Singapore, told AFP.

“But in the short term, weak economic data from the US and China are going to put more downward pressure on prices, as opposed to the market turning bullish,” he added.

Oil prices fell overnight on fresh signs of economic weakness in China and the United States — the world’s largest crude consumers.

A trio of Chinese economic data — on industrial production, retail sales and fixed-asset investment released Monday — raised alarms about the pace of growth in the world’s second-largest economy.

In the United States, the world’s biggest oil consuming nation, official data showed a slight gain in retail sales in April that was better than the decline expected.

Business inventories were flat in March.

Meanwhile, traders are also keeping a close watch on global output levels, analysts said.

The Organisation of the Petroleum Exporting Countries (OPEC) last week boosted production to 30.21 million barrels a day in April from 29.93 million in March.

The cartel, which pumps about 35 percent of global oil supplies, will hold its next output meeting in Vienna on May 31.

“Currently supply is exceeding demand, and that is also weighing on prices,” said Shum.