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| Oil price nudges above $34 again | |
| (about 4 hours later) | |
| Oil prices have risen to above $34 a barrel despite concerns about weakness in the US economy, which continue to cast a shadow over the commodity. | Oil prices have risen to above $34 a barrel despite concerns about weakness in the US economy, which continue to cast a shadow over the commodity. |
| Analysts fear rising US unemployment will hit demand for oil. | Analysts fear rising US unemployment will hit demand for oil. |
| The global slowdown has seen oil prices fall more than $110 off the highs seen in July last year. | The global slowdown has seen oil prices fall more than $110 off the highs seen in July last year. |
| US light, sweet crude rose 80 cents to $34.78 a barrel, having tumbled $1.96 in New York to $33.98. London Brent for April rose 31 cents to $46.34. | |
| "The economic indicators in the developed world remain weak and that's impinging on oil demand," said David Moore, a commodity strategist at Commonwealth Bank of Australia in Sydney. | "The economic indicators in the developed world remain weak and that's impinging on oil demand," said David Moore, a commodity strategist at Commonwealth Bank of Australia in Sydney. |
| "It's premature to say the fall in demand has bottomed." | "It's premature to say the fall in demand has bottomed." |
| Weak demand | Weak demand |
| Earlier this week, the Energy Information Administration reported a seventh consecutive weekly increase in nationwide crude oil stocks as the economic crisis crushed business and consumer demand for fuel. | Earlier this week, the Energy Information Administration reported a seventh consecutive weekly increase in nationwide crude oil stocks as the economic crisis crushed business and consumer demand for fuel. |
| And rising unemployment has led to further fears of weakening demand for oil among US consumers. | And rising unemployment has led to further fears of weakening demand for oil among US consumers. |
| New claims for unemployment benefit remain close to record highs. | New claims for unemployment benefit remain close to record highs. |
| The US jobless rate rose to 7.6% in January, up from 7.2% in December, according to official figures - the highest level since 1992. | The US jobless rate rose to 7.6% in January, up from 7.2% in December, according to official figures - the highest level since 1992. |
| The rapid rise in unemployment suggests the US recession is deepening. | The rapid rise in unemployment suggests the US recession is deepening. |
| Members of both houses of Congress have agreed a stimulus package, now worth $789bn (£549bn), including tax cuts and spending aimed at rescuing the US economy. | Members of both houses of Congress have agreed a stimulus package, now worth $789bn (£549bn), including tax cuts and spending aimed at rescuing the US economy. |
| But analysts have questioned how much the oil price will benefit from it, with reduced production more likely to raise prices. | But analysts have questioned how much the oil price will benefit from it, with reduced production more likely to raise prices. |
| "We're at the point where you start to see marginal producers have to shut down production," said Peter Elston, a strategist with Aberdeen, a fund manager in Singapore. | "We're at the point where you start to see marginal producers have to shut down production," said Peter Elston, a strategist with Aberdeen, a fund manager in Singapore. |
| "That gives you quite good support for prices." | "That gives you quite good support for prices." |