Brent oil price trading up in Asia despite high inventories

In London, Brent crude oil futures rose 34 cents to $65.83 the ICE Futures exchange as oil prices rose on Wednesday in Asia despite an increase in US crude inventories, which suggests consumer demand remains weak.

Benchmark crude for November deliver was up 42 cents at $67.13 by midday in Singapore in electronic trading on the New York Mercantile Exchange. The contract fell 13 cents to settle at $66.71 on Tuesday.

US oil inventories rose last week, the American Petroleum Institute said late Tuesday. Crude stocks increased 2.8 million barrels while analysts had expected a jump of 2.1 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.

"There's no doubt that we still have very high levels of inventories, and that's probably going to prevent oil from breaking above $75," said Christoffer Moltke-Leth, head of sales trading at Saxo Capital Markets in Singapore.

Oil has traded between $65 and $75 for months as investors mull the strength of a global recovery from recession. Crude bounced off the $65 level earlier this week.

"The support we saw at $65 was quite significant," Moltke-Leth said. "The hope for recovery is still pretty strong, and that's what's holding prices up."