Friday, October 21 2005 11:28 Hrs (IST) - World Time -

Singapore: Oil prices weakened further in Asian trading today (Oct 21, 2005) as the threat from Hurricane Wilma eased amid signs that US demand is tapering, dealers said.

At 9.50 am (0720 IST), New York's main contract, light sweet crude for delivery in December, fell 15 cents to US$ 59.87 a barrel from its close of US$ 60.02 in the United States yesterday (Oct 20, 2005).

The November contract expired yesterday at US$ 61.03 a barrel, down 1.38 dollars, after trading as low as US$ 59.85 for the first time since July 28.

"The market is weak people are looking at the immediate problem now," said Tony Nunan, manager for energy risk management with Mitsubishi Corp's international petroleum business in Tokyo.

"Inventories have built and demand for products in the United States has fallen so that's sending bearish signals to the market in the short term," he said.

The market is still absorbing news of a surprise rise in US crude and gasoline reserves from data released on Wednesday (Oct 20, 2005) and watching the track of Hurricane Wilma, which seemed likely to avoid the main oil producing and refining areas around the Gulf of Mexico.

The US Department of Energy said Wednesday in its weekly report that crude stocks rose 5.6 million barrels in the week to October 14, almost three times more than forecasts of a 2.0-million-barrel increase.

Gasoline reserves gained 2.77 million barrels, compared with market predictions of a 1.2-million-barrel decrease.