SINGAPORE (Thomson Financial) - Oil prices fell in Asian trade Tuesday on profit-taking but the dip is likely to be brief amid strong concerns over low US gasoline supplies.
At 10:54 am (0254 GMT), New York's main contract, light sweet crude for August delivery, was 12 cents lower at 70.97 US dollars a barrel from 71.09 dollars in late US trades Monday.
Brent North Sea crude for August was 22 cents lower at 72.41 dollars.
"Gasoline demand is expected to be strong and gasoline inventory is low compared to historical levels," said Victor Shum, an analyst with energy consultancy Purvin and Gertz in Singapore.
"So gasoline demand therefore continues to be a factor driving the market," he said.
Gasoline reserves are in focus because of the US summer driving season when demand typically peaks as many Americans take to the roads for their annual holidays, particularly around Wednesday's July 4 holiday.
US gasoline stockpiles fell 700,000 barrels to 202.6 million barrels in the week ending June 22, surprising the market which had expected a gain of 1.0 million barrels.
The International Energy Agency (IEA), policy adviser to 26 member countries, expressed disappointment on Monday that many refineries, particularly in the US, seemed unable to process sufficient quantities of crude oil.
IEA director Claude Mandil said the agency hoped for "a surge in refinery throughputs" within a few weeks.
Mandil noted that forecasts of strong growth in oil demand during the third and fourth quarters were a worry amid tight supplies.
"Our other concern is that product stocks are low in many developed countries. There will be a need to process a lot of crude," Mandil said.
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