SINGAPORE // Oil prices hovered near US$70 (Dh257) a barrel in Asia after a pullback in global stocks triggered a sharp drop on Monday. Benchmark crude for October delivery was up 28 cents at $70.24 a barrel by midday Singapore time. The contract on Monday lost $2.78 to settle at $69.96 after a drop in stocks heightened investor concerns that the global economic recovery may be weaker than expected.
China's benchmark stock index fell 6.7 per cent yesterday while the Dow Jones industrial average fell 0.5 per cent. Most Asian stock indexes rebounded modestly today, including China's. "Stocks are a leading indicator of the economy, so if we have a slump in stocks, that's one fewer driver to support high oil prices," said Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore. Oil will likely trade between $65 and $70 during the next few weeks, Mr Shum said.
"I don't expect a big pullback because we are starting to see more signs of economic life," he said. "There's clear evidence that the global economy has reached a bottom." In other Nymex trading, gasoline for September delivery was steady at $1.99 a gallon and heating oil was steady at $1.78 a gallon. In London, Brent crude was up 35 cents at $70.00. * AP