Brent oil price trading near $72 amid double dip concerns

Brent oil prices are trading higher on Tuesday, back near the $72 a barrel mark amid renewed global oil demand concerns as analysts worry about a possible double dip recession around the corner.

In London, Brent crude oil futures for August 2010 delivery was as $71.53 a barrel 07.15 GMT on the ICE Futures Exchange.

Many oil traders were reluctant to enter the oil market until the US reopens for trading later today and the latest economic data are published that either confirm or contradict other signs that the US recovery has hit a soft spot.

“Oil prices are being squarely hit by macro issues. The economic data lately has been a drag, particularly in the US This looks backed up by drops in both CFTC longs and shorts, flagging a more cautious mood,” said Australia and New Zealand Banking Group Ltd.

In the UK, global services growth geared down a notch in June, data showed on yesterday, supporting the view in financial markets that emerging and developed economies are set to cool off through the second half of 2010, having an effect on crude oil demand.

The reports followed a series of similar health checks on global manufacturing last week which told a similar story and which together could stoke smouldering fears of a double dip recession in many developed economies.

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