SINGAPORE - Crude prices slipped in Asia Wednesday with traders taking profit from an unexpected overnight rally sparked by Iranian sabre-rattling against a European oil embargo, analysts said.
New York's main contract, light sweet crude for delivery in August fell 55 cents to $87.11 a barrel and Brent North Sea crude for August delivery shed 61 cents to $100.07.
Crude traders were reaping a quick profit after a price surge of more than $3.00 in late New York trade Tuesday, said Justin Harper, market strategist for IG Markets Singapore.
"It could be about profit-taking because it has caught many by surprise, people weren't expecting (prices) to rise the way it has done. Some people are probably taking some profit out of the market," he told AFP.
Crude would also likely continue rising in the near term as Iran expressed outrage over a European Union-imposed oil embargo on Tehran, Harper said.
Full implementation of an EU embargo on Iranian oil, which took effect on Sunday, provoked anger in Tehran, which said the measures would hurt talks with world powers over its disputed nuclear activities.
On Tuesday, Iran test-fired missiles into its central desert region, drawing a US warning that the tests were in violation of UN resolutions that ban Iran from any ballistic weapons activity.
Meanwhile, some 120 lawmakers in Iran's 290-seat parliament backed a draft bill calling for the strategic Strait of Hormuz to be closed to oil tankers headed to Europe in retaliation for the EU embargo.source: interaksyon.com
