The New Nation - Internet Edition

AFP, Singapore

Oil eased in Asian trade on Monday from closing record highs ahead of a crucial US-Turkey meeting aimed at resolving a crisis over Kurdish rebels in northern Iraq, dealers said. New York's main contract, light sweet crude for December delivery, was off 95 cents at 94.98 dollars a barrel from its closing record high of 95.93 in US trade Friday. Brent North Sea crude for December delivery dropped 59 cents to 91.49 dollars. "Today we will continue to see a decline when New York opens later," said Steve Rowles, an analyst with CFC Seymour in Hong Kong. "The fact that we have the Kurdish talks today is a major eventt it's a good time to take profit," he said, referring to the meeting between the US and Turkish leaders later Monday.

Tensions between Turkey and Kurdish rebels were a major driver behind the spike in oil prices as traders were concerned supplies from the oil-rich Middle East will be disrupted if the crisis spills over into the region. Turkey has massed an estimated 100,000 troops along the border and threatened a large-scale incursion against Kurdish rebel bases in northern Iraq, site of several Iraqi oil fields.

Analysts say oil prices remain under pressure to rise further.

"The emerging political crisis in Pakistan, where President (Pervez) Musharraf has declared emergency rule, may add to oil market concerns about instability in the Middle East," the Commonwealth Bank of Australia said in a note.

"As well, some weather forecasters were expecting colder weather in the US North-East in the coming week, which might add to the demand for heating oil," it said.