Oil lower amid fears of Spain bailout

SINGAPORE: Oil prices edged lower in Asian trade on Wednesday as concerns that debt-plagued Spain could be forced to seek a bailout roiled the markets.

Prices were under pressure after the euro plummeted, making dollar-priced oil more expensive and dampening demand.

New York's main contract, West Texas Intermediate crude for delivery in July was down 41 cents to $90.35 per barrel while Brent North Sea crude for July shed 43 cents to $106.25 in morning trade.

"Spain remains the key worry for the eurozone debt crisis, eclipsing optimism in Greece that the pro-bailout conservatives are leading the polls ahead of next month's election," said analysts from DBS Bank in a commentary.

"As far as the eurozone crisis is concerned, the market does not see the light at the end of the tunnel," it added.

The Spanish government on Tuesday announced new bonds to finance debt-struck regions. As banks scrambled to clean up bad loans, investors feared the country may be inching closer towards seeking international aid.

Across the Atlantic, analysts forecast US crude inventories to remain at the highest level for this time of the year in 22 years, indicating faltering demand in the world's largest oil-consuming economy. (AFP)