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Oil prices turn mixed in Asian trade

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(Globalpost/GlobalPost)

Oil prices were mixed in Asian trade Wednesday as concerns over weak US energy demand returned to spook investors, analysts said.

New York's main contract, West Texas Intermediate (WTI) light sweet crude for delivery in May, lost steam after rising in the morning, declining six cents to $88.66 a barrel in the afternoon.

Brent North Sea crude however climbed back above the $100 mark after falling to a nine-month low the day before. The Brent contract for June delivery rose 29 cents to $100.20 after slumping to $98 a barrel Tuesday, its lowest since July 11, 2012.

"WTI prices have always been on the basis of the US economy. The oversupply issue is still there, which is putting downward pressure on prices," said Kelly Teoh, market strategist at IG Markets in Singapore.

"Markets are currently consolidating. Both WTI and Brent prices will eventually converge, so the dip in WTI prices is likely to be a short-term thing," she added.

Both contracts were up earlier Wednesday as investors reacted to US central bank data showing US industrial production slowed in March but over the first quarter posted its biggest gain in a year.

For the first three months of the year output surged at an annual rate of 5.0 percent, the strongest increase since the first quarter of 2012.

However, US crude inventories remain high, reflecting weaker energy demand.

Oil prices tumbled at the start of the week on weak Chinese data showing growth in the world's number two economy slowed in January-March, suggesting a recent pick-up was not as strong as initially hoped.

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http://www.globalpost.com/dispatch/news/afp/130417/oil-prices-turn-mixed-asian-trade