Oil rebounds in Asia, Brent crude above $102

Oil prices were higher in Asian trade Thursday on persistent concerns over the situation in Egypt where the embattled government has warned of a military crackdown against protesters.

New York’s main futures contract, light sweet crude for March, climbed 19 cents to $86.90 a barrel.

The contract fell overnight on rising US crude stockpiles, an indication of weak demand from the world’s biggest oil-consuming nation.

Brent North Sea crude for delivery in March was up 28 cents to $102.10 a barrel on the Intercontinental Exchange (ICE) in London.

“Crude oil prices have eased back from their recent highs as immediate concerns over supply disruptions have eased, but ICE Brent is still trading above $100 a barrel,” Standard Chartered analysts said in a research note.

“We expect the market to continue to price in a supply-risk premium as geopolitical tensions rumble on near-term.”

As protests demanding President Hosni Mubarak to step down escalated in Egypt, Foreign Minister Ahmed Abul Gheit warned the army would intervene.

The United States immediately encouraged the Egyptian army to continue displaying “the restraint that they have shown”.

While Egypt is not a major crude producer, it is home to the Suez Canal, a key shipping route that cuts through the country to provide a sea link between Europe and Asia.

The canal allows ships safer and faster travel between the two regions without having to sail around the African continent and carries about 2.4 million barrels of crude daily, roughly equal to Iraq or Brazil’s output.