PERTH - Oil held above $36 a barrel on Thursday, pausing after steep overnight losses, as lingering worries over the health of the global economy and forecasts for a hefty fall in global energy demand weighed on sentiment.
Most Asian markets slid on Thursday despite the U.S. Congress having reached a deal on $789 billion in new spending and tax cuts on Wednesday, with investors remaining wary about the global economic outlook.
Investors will now train their eyes on U.S. weekly jobless claims and January retail sales data due later in the day, which will give a clearer indication of how the U.S. economy is faring.
U.S. light crude for March delivery crept up 11 cents to $36.05 a barrel by 0655 GMT. The contract settled down $1.61, or 4.3 percent, on Wednesday.
London Brent crude rose 75 cents to $45.03, stretching its rare premium over U.S. oil to near record levels of above $9 hit last month.
"The market isn't too impressed by the stimulus package. After all the bearish data last night, it's pretty obvious that global energy demand will taper off quite quickly," said Michelle Kwek, an analyst at Informa Global Markets in Singapore.
"The underlying fundamentals for oil remain week and it's unlikely that we'll see any economic recovery in the near term."
Oil has tumbled around 10 percent this week, having fallen four sessions in a row since last Friday, on demand worries and fears the U.S. bank rescue plan would not go far enough to revive the ailing financial sector.
Oil prices took a battering on Wednesday after the U.S. Energy Information Administration said domestic crude stocks had ballooned 4.7 million barrels to 350.8 million in the week to February 6, against a forecast for a rise of 3.1 million.
The latest increase in U.S. crude stocks comes on the heels of a combined rise of more than 13 million barrels in the prior two weeks, and crude inventories are now moving significantly above their five-year range, BNP Paribas said in a report.
Oil's losses were further exacerbated by a separate report from the International Energy Agency forecasting global demand to contract by nearly a million barrels per day (bpd) -- the most since 1982 -- to 84.7 million bpd in 2009.
Underlining the damage caused by the global financial crisis, data showed global trade activity in goods and commodities had tumbled.
The United States reported a fifth straight monthly fall in exports and imports in December, while China's January exports fell 17.5 percent from a year earlier, a sharp acceleration from a 2.8 percent dip in December. Imports plummeted 43 percent, twice as much as in the previous month.
Most Asian markets slid on Thursday despite the U.S. Congress having reached a deal on $789 billion in new spending and tax cuts on Wednesday, with investors remaining wary about the global economic outlook.
Investors will now train their eyes on U.S. weekly jobless claims and January retail sales data due later in the day, which will give a clearer indication of how the U.S. economy is faring.
U.S. light crude for March delivery crept up 11 cents to $36.05 a barrel by 0655 GMT. The contract settled down $1.61, or 4.3 percent, on Wednesday.
London Brent crude rose 75 cents to $45.03, stretching its rare premium over U.S. oil to near record levels of above $9 hit last month.
"The market isn't too impressed by the stimulus package. After all the bearish data last night, it's pretty obvious that global energy demand will taper off quite quickly," said Michelle Kwek, an analyst at Informa Global Markets in Singapore.
"The underlying fundamentals for oil remain week and it's unlikely that we'll see any economic recovery in the near term."
Oil has tumbled around 10 percent this week, having fallen four sessions in a row since last Friday, on demand worries and fears the U.S. bank rescue plan would not go far enough to revive the ailing financial sector.
Oil prices took a battering on Wednesday after the U.S. Energy Information Administration said domestic crude stocks had ballooned 4.7 million barrels to 350.8 million in the week to February 6, against a forecast for a rise of 3.1 million.
The latest increase in U.S. crude stocks comes on the heels of a combined rise of more than 13 million barrels in the prior two weeks, and crude inventories are now moving significantly above their five-year range, BNP Paribas said in a report.
Oil's losses were further exacerbated by a separate report from the International Energy Agency forecasting global demand to contract by nearly a million barrels per day (bpd) -- the most since 1982 -- to 84.7 million bpd in 2009.
Underlining the damage caused by the global financial crisis, data showed global trade activity in goods and commodities had tumbled.
The United States reported a fifth straight monthly fall in exports and imports in December, while China's January exports fell 17.5 percent from a year earlier, a sharp acceleration from a 2.8 percent dip in December. Imports plummeted 43 percent, twice as much as in the previous month.
