Tuesday April 14, 04:21 PM
Oil prices bounce, mirroring stock markets
LONDON (AFP) - Oil prices rebounded on Tuesday, supported by rising global stock markets, upbeat results from US bank Goldman Sachs and hopes for a pick-up in world energy demand, analysts said.
New York's main futures contract, light sweet crude for May delivery, added 66 cents to 50.71 dollars a barrel.
London's Brent North Sea oil for May delivery gained 1.12 dollars to 53.26.
"Crude oil futures continue to trade near 50 dollars per barrel," said Sucden Financial Research analyst Brenda Sullivan.
Oil had slid on Monday after the International Energy Agency (IEA) lowered its projection of global demand for 2009.
But traders took their cue on Tuesday from surging global stock markets which raised the prospect of strengthening energy demand.
Most equity markets rallied, with banks boosted by upbeat results from Goldman Sachs, as dealers returned to their desks after the Easter holiday weekend.
Equities also won ground after Goldman launched plans to repay its US government rescue aid of 10 billion dollars (7.5 billion euros) with a 5.0-billion-dollar share issue plus cash from additional resources.
Goldman posted first-quarter net profit of 1.81 billion dollars, with earnings per share of 3.39 dollars.
That was sharply higher than 1.33 dollars per share forecast by most analysts and sparked talk that the global banking sector could have turned the corner in a global financial crisis which stretches back to August 2007.
Meanwhile, the Paris-based IEA had forecast Friday that the global economy would contract 1.4 percent in 2009, instead of a modest expansion.
It also slashed 2009 global oil demand by one million barrels per day to 83.4 million barrels per day, about 2.4 million bpd less than in 2008 and the lowest level since 2004.
In response, New York crude had slumped 2.19 dollars and London Brent oil had tumbled by 1.92 dollars on Monday.
The sharp worldwide economic slowdown has curbed energy demand and slashed oil prices from their record peaks of above 147 dollars per barrel that were hit last July.
In turn, that has ravaged revenues for the 12-nation OPEC oil cartel that pumps 40 percent of the world's crude supplies.
Mohammad Ali Khatibi, Iran's representative in the group, warned Monday that OPEC may cut production again if global demand for crude continues to weaken.
"If demand continues to fall until the next meeting of OPEC, a further output cut is possible," Khatibi was quoted as saying by Iranian daily Hamshahri.
The next meeting of the Organization of the Petroleum Exporting Countries (OPEC) is on May 28.
OPEC has reduced its production target by 4.2 million barrels per day since September to 24.84 million bpd, the lowest level since just after the US-led invasion of Iraq in 2003.
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