Oil dips below $76 in Asian trade

SINGAPORE: Oil fell below $76 in Asian trade on Monday afternoon, reversing earlier gains as traders cashed in on an over-bought market, analysts said.

New York's main contract, light sweet crude for August delivery, slid 42 cents to $75.67 a barrel and Brent North Sea crude also for August dipped 38 cents to $75.04.

Traders were taking profits from oil as the market was "getting ahead of itself," said Victor Shum, an analyst with energy consultancy Purvin and Gertz.

"Its primarily people selling to lock in profits.... Oil is getting a little too strong and over-bought and so there's selling among traders."

Oil had crept above $76 in morning trade as buoyant stock markets and expectations of healthy corporate earnings in the US pushed up prices.

Shum said prices would likely hover around $75 in the near term.

"The question is whether there is enough confidence in the market for oil prices to hold above $75," he said.

"I think that given the uneven economic recovery around the world, pricing in the mid-$70 is probably a more stable value."