Oil prices ease in Asian trade, above $53

SINGAPORE: Oil prices fell in Asian trade today after hitting four-month peaks following a US government plan to clear toxic assets from banks.

New York's main futures contract, light sweet crude for May delivery, eased 25 cents to $53.55 a barrel.

Brent North Sea crude for delivery in May shed 30 cents to $53.17.

Oil prices soared to their highest levels since November 2008 in intraday trade Monday, with Nymex crude hitting a peak of $54.05 and Brent touching $53.86.

Despite the price dip in morning trade today, analysts said the $500 billion US plan to purge banks of toxic assets would reverse flagging oil demand in the world's largest energy consumer.

"People are making bets that we will have the banking system partially fixed and have credit start flowing, that the stimulus that is now undergoing in the US will be enough to lift ourselves," said Bart Melek, a commodity strategist with BMO Capital Markets.

"And that essentially means that at some point late in the year we will probably have better demand for oil in the US."

The US Treasury unveiled a long-awaited plan Monday to buy up toxic assets clogging the financial system using government funds, loans to investors and guarantees to attract private capital.