(SINGAPORE) After shooting up at blinding speed, the price of crude oil has come down even faster - plunging US$10.50 a barrel in just two days. This reversal and a quick rally late yesterday following a Nigerian pipeline explosion have got the market confused.

'It's anybody's guess where prices will head next,' one trader said, while another economist believes that this is just a temporary respite and 'not a tipping point yet'.

After hitting an all-time high of over US$147 a barrel just last Friday - and threatening to breach US$150 - crude oil had slipped to just over US$134 in Asian trade yesterday afternoon, following the slide in New York on Tuesday and Wednesday.

This meant relief for some and fresh worries for others. Singapore Airlines' stocks gained 38 cents or 2.6 per cent from the latest oil price fall to close at S$15.06. Meanwhile, the stocks of alternative energy players were hit. Biofuel/palm oil stock Wilmar fell 23 cents to S$4.31, while Straits Asia, which has coal mine assets, closed at S$2.78, down 15 cents.

In London, oil rose above US$136 a barrel yesterday as investors resumed buying after the recent sharp drop and boosted by fresh cuts to Nigerian oil output.

A Reuters News Agency report said an attack on an oil pipeline in Nigeria, the world's eighth-biggest oil exporter, shut 20,000 barrels per day of crude oil production.

Italian oil company Eni was quoted as saying that it had temporarily shut down production of 47,000 barrels of oil a day there because of loss of pressure in pipeline.

US crude rose US$1.70 to US$136.30 a barrel at 1450 GMT, recovering from lows of US$133.02 while London Brent crude for September was $1.54 up at US$137.35.

Meanwhile, Singapore Petroleum Company and Caltex cut their pump prices yesterday afternoon, making it the second trim this month - after an earlier relentless climb in pump prices over the past 18 months.

The catalyst for the earlier stumble in oil prices was a rise in US crude and gasoline inventories - reflecting what most saw as a slowdown in US energy demand because of the economic downturn there.

Brazilian production was also reportedly back at full capacity, while a cut in Opec's forecast of global oil demand growth in 2009 also weighed on prices.

The New York Times reported that there was also fresh evidence from the Automobile Association that Americans were driving less because of rising gasoline prices which had hit a record US$4.11 a gallon.

In Singapore, SPC and Caltex cut petrol pump prices by four Singapore cents per litre and diesel by two cents. This brought their premium 98 octane petrol to S$2.28 a litre and diesel to S$2.013. SPC fell eight cents to S$6.99.

BT understands from oil industry sources that petrol and diesel consumption in Singapore in the first half has clearly fallen - although they could not specify by exactly how much - as the higher pump prices here have started to bite.

It has become a simple issue of either driving less or paying more. 'I used to pay S$150-180 a month, and I pay more than double now, or about S$400,' complained one oil broker, who said he doesn't really drive much.

Earlier this month, on July 9, oil companies made their first pump price cut here following a US$10 crude price drop, as political tension between Israel and Iran eased.

Chua Hak Bin, Asian strategist for Deutsche Private Wealth Management, told BT that he doesn't reckon that oil prices have reached tipping point yet.

'Prices are likely to stay elevated and volatile,' he said, adding that 'the fundamental drivers, like market demand, are still very much there.'

Besides, geopolitical risks in the Middle East still remain, he said.

Over in the US, there are also concerns about upcoming hurricanes and their possible impact on oil platforms in the Gulf of Mexico.

One oil broker thinks that the fall in oil prices is just temporary, and that prices will start moving up again in August. The latest fall simply reflects players selling down to make a profit, he said.