Thursday, July 28 2005 12:31 Hrs (IST) - World Time -

Singapore: Oil prices were higher in Asian trade today (July 28, 2005) as the Bombay High offshore oil platform fire stoked supply worries in a tight market, dealers said.

New York's main contract, light sweet crude for delivery in September, was at 59.34 dollars a barrel at 11:20 am (0850 IST), up 23 cents from its close of 59.11 dollars in the United States yesterday (July 27, 2005).

"Demand is still tight so any loss of production, no matter where it is, has an impact on the market," Kurt Barrow, a senior principal at US energy consultancy Purvin and Gertz in Singapore, told sources.

Barrow said that, "The Indian platform's output doesn't appear to be very much but 100,000 barrels a day is probably five to 10 per cent of all the world's spare capacity so in those terms it is important."

"At this point we don't know if production is going to be off for a few days or a few months," he said.

"When there is a supply side problem, whether it is in India or Nigeria or the US Gulf Coast, the oil market tends to respond with upper price signals at least until the situation is better known."

Yesterday, oil prices were little changed as traders digested a snapshot of US crude inventories that was mostly in line with expectations.

US crude oil and petrol stocks fell over the past week but reserves of diesel and heating oil went up, according to the Department of Energy (DoE).

The DoE said crude oil stocks fell 2.3 million barrels to 317.8 million in the week ending July 22 but were still above average for this time of year.