SEOUL Oil prices eased below $94 a barrel on Thursday, taking a breather after a rally of almost 5 percent in the previous session on a drawdown in U.S. crude stocks and a move by major central banks to ease tight credit conditions.
U.S. light, sweet crude futures fell 44 cents to $93.95 a barrel in Globex electronic trading by 0307 GMT, paring Wednesday's jump of more than $4 a barrel as traders questioned whether the central banks' move would solve the credit crunch.
London Brent crude fell 52 cents to $93.50 a barrel.
"NYMEX prices fell because of a technical correction, after rising more than $4 during floor trading last night," said Shuji Sugata, manager at Mitsubishi Corp Futures Ltd.
The U.S. Federal Reserve will band together with its counterparts in Europe, Japan, Canada and Britain to shore up liquidity in financial markets.
This marks their first coordinated action since terror attacks shut down U.S. financial markets on Sept. 11, 2001, and boosted markets overnight.
Oil prices have come under pressure in recent weeks, easing from a record $99.29 hit on Nov. 21 because of concerns over the impact of tight credit conditions on economic health of the world's top consumer, the United States.
A sharp 700,000-barrel decline in U.S. weekly inventory data on Wednesday, which sent stockpiles down to their lowest since March 2005, also supported oil prices.
Distillates stocks fell 800,000 barrels, while gasoline inventories rose 1.6 million barrels, the data showed.
Exxon Mobil Corp said operations at its 150,000 barrel per day (bpd) Los Angles-area refinery in Torrance, California, were returning to normal on Wednesday after two steam boilers were relit, marginally lifting pressure off the market.
Trading of NYMEX futures contracts on the CME's Globex electronic platform resumed earlier in the day after a technical glitch that halted activity for over an hour.
Prices returned to normal around midnight GMT.
"I don't think the computer mishap had any impact on pushing down prices," Sugata said.
(Additional reporting by Osamu Tsukimori in Tokyo)
Trending On Reuters
Eighteen village councils in Uttar Pradesh are demanding a local Coca-Cola bottling plant be prohibited from extracting water from the ground, claiming its over usage has led to water scarcity in the area, said an environmental campaign group. Full Article