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Oil prices firm after heavy falls
LONDON (AFP) - Oil prices firmed up on Friday after falling heavily on concerns that energy demand will shrink because of a US-led global economic slowdown, traders said.
The markets were meanwhile awaiting a crucial vote by US lawmakers on a rescue package for the troubled US financial system.
New York's main contract, light sweet crude for November delivery, gained 36 cents to 94.33 dollars a barrel.
London's Brent North Sea crude for November rose 37 cents to 90.93 dollars.
Oil prices slumped some 4.50 dollars on Thursday despite the US Senate's approval of the plan to buy up tainted mortgage-related assets.
In Washington later Friday, the House of Representatives was to vote on the revised plan to spend 700 billion dollars (505 billion euros) that the US government hopes will ease pressure on the economy.
"Crude futures were almost unchanged in quiet trade (on Friday), consolidating after (the) losses ... ahead of an all-important vote on an improved financial sector bailout plan proposed by the US Treasury," said Sucden analyst Andrey Kryuchenkov.
"Trade is likely to be subdued today ahead of the vote," he said.
"Growth fears are likely to cap gains in oil prices in the near future, until we start seeing a pick up in winter demand with some improving economic data from the developed world and concerns over the credit market recede."
The market was dragged down this week by a surprise jump in crude inventories in the United States, the world's biggest consumer of energy.
The US Department of Energy (DoE) said Wednesday that crude stockpiles rose 4.3 million barrels in the week ending September 26, surprising traders who had expected a fall of around 1.7 million barrels.
US oil demand sank 7.1 percent over the past four weeks compared with the same period a year ago, according to the DoE data.
Analysts at Merrill Lynch meanwhile slashed their 2009 global oil demand growth estimates to 400,000 barrels per day.
Oil prices have dropped sharply from record high levels above 147 dollars reached in July on concerns that demand will falter badly.
"People are realising that the decline in demand is probably not just a US phenomenon," said David Johnson, an oil analyst with Macquarie Securities in Hong Kong.
"I think people are just becoming a little bit more bearish (negative) over their outlook for oil consumption over the next 12 to 15 months."
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