Oil below 75 dollars in Asian trade

SINGAPORE: Oil prices dipped in Asian trade Friday on investor concerns the European Union's pledge to help Greece deal with a crippling debt crisis lacked details.

New York's main futures contract, light sweet crude for delivery in March, fell 39 cents to 74.89 dollars a barrel.

Brent North Sea crude for April delivery was down 30 cents to 73.82 dollars a barrel.

EU leaders met Thursday in Brussels to discuss Greece's deficit and debt crisis, but analysts said the meeting failed to soothe investors' worries over the problem and concerns it could spill over to the rest of the eurozone.

"There has been some decent gains in oil prices this week, but there's still a lot of concerns over sovereign debt problems in Europe," said Ben Westmore, a minerals and energy economist with the National Australia Bank in Melbourne.

"The lack of detail in the deal seems to have scared the markets somewhat," he added.

EU leaders at their summit promised solidarity with debt-stricken Greece but held back from offering an immediate cash bailout.

Under a European Commission budget target agreement, Greece must reduce its public deficit this year by four percentage points from the current 12.7 percent of GDP, which is more than four times above the EU limit.

The absence of a firm rescue plan for Greece has led the euro single currency to slide against the US dollar.

As oil is traded in US dollars, the commodity becomes more expensive for holders of weaker currencies, leading to lower demand and depressing prices.

Other analysts said forecasts of stronger energy demand should support oil prices over the long term.

The International Energy Agency forecast on Thursday that world oil demand and prices would rise more than previously expected this year, driven higher by strong growth in emerging economies.

The Paris-based agency said demand was now expected to be 86.5 million barrels per day in 2010 compared with a forecast last month of 86.3 million.

It forecast average prices to rise to 75 dollars per barrel from 58 dollars in 2009.