Oil prices below 74 dollars in Asia

Oil prices fell below 74 dollars in Asian trade on Wednesday, dragged down by a sluggish start for regional equity markets, analysts said.

New York’s main contract, light sweet crude for October delivery, slumped 23 cents to 73.86 dollars a barrel in the afternoon.

Brent North Sea crude for delivery in October slipped 14 cents to 77.60 dollars.

Poor openings by major Asian bourses were pulling down oil prices, said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.

“I think right now it’s really the knock-on effect from equities in Asia…. Oil is pulling back as Asian stocks are coming off,” he said.

Japanese, South Korean and Singapore stock markets were down in noontime Asian trade, with the Nikkei index the hardest-hit, losing 1.97 percent by midday.

Traders in Japan were spooked by a surging yen, which hit a 15-year-high against the US dollar on Tuesday even as the Bank of Japan promised to intervene to curb its continued rise if necessary.

The central bank kept its key interest rate unchanged at 0.1 percent to continue nurturing a moderate recovery, but pledged “policy actions in a timely and appropriate manner” if needed.

This was in addition to the bank extending a multi-billion dollar loan programme to curtail the strengthening yen last week, which was received poorly by the market as stocks slumped and the Japanese unit rose further following the announcement.