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Oil prices dip on profit taking

World oil prices fell on Thursday as traders booked profits from the previous day's rally on signs of strengthening crude demand in the United States.

NEW YORK: World oil prices fell on Thursday as traders booked profits from the previous day's rally on signs of strengthening crude demand in the United States.

The market also retreated on an apparent easing of tensions over the Ukraine-Russia crisis, traders said, although the crisis appeared to be reigniting Thursday.

The US benchmark, West Texas Intermediate for delivery in June, closed at $100.26 a barrel, a loss of 51 cents from Wednesday.

Brent North Sea crude for June dipped nine cents to settle at $108.04 a barrel in London.

"Petroleum prices are moderately lower on profit taking off Wednesday's rally as traders digest both recent headlines on Ukraine and the latest US inventory data," said Tim Evans of Citi Futures.

The oil market had jumped Wednesday by more than $1 after US crude inventories unexpectedly fell from a record high last week, suggesting that demand may be picking up the world's leading crude consumer.

Traders also appeared cautious ahead of the weekend as the Ukraine-Russia crisis continues to grind on, said Carl Larry of Oil Outlooks and Opinion, pointing to modest trade volumes as evidence.

Investors were also digesting Chinese official trade data released Thursday. The world's largest energy consumer posted a $18.45 billion trade surplus in April, up sharply from a March surplus of $7.7 billion.

"China's trade data show signs of recovery but continue to understate the true health of the export sector," said Julian Evans-Pritchard, China economist for Capital Economics.

Oil imports jumped 23 per cent from March to 6.86 million barrels per day in China, the world's largest energy consumer, Barclays analyst Sijin Cheng noted.

"While demand was gradually recovering in April after a sluggish holiday season, the surge in imports likely reflected strategic stockpiling rather than refinery demand. Refinery throughput is likely to remain on the soft side during the spring maintenance season," he said.

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