Oil stays below $35

13/02/2009

In the last morning of trading on the New York Mercantile Exchange this week, oil prices have failed to rise above $35 (£24) a barrel.

After dropping nearly two dollars yesterday (February 12th), the bourse's main contract, light, sweet crude for March delivery rose 45 cents by 5:32 Eastern Time to stand at $34.43 a barrel.

Heating oil prices have also had a weak period this week, following crude downwards on the back of weak demand forecasts and persistent concerns about the health of the US economy.

The approval of President Obama's economic stimulus package failed to support crude prices as analysts grew wary of whether the plan would fulfil its aim of bootstrapping the country out of recession.

David Moore, a commodity strategist at Commonwealth Bank of Australia in Sydney, commented: "The economic indicators in the developed world remain weak and that's impinging on oil demand."

He added that it would be premature to say that demand had reached its nadir, suggesting that crude and distillates such as heating oil could fall further in the coming weeks.