News Column

Oil Pulls Back on US 'Fiscal Cliff' Worries

Dec 28, 2012

Oil prices eased in choppy trading last night as unresolved U.S. budget talks left open the possibility that looming mandated tax hikes and spending cuts could push the top oil-consuming economy into recession.

Brent and U.S. crude remained on track for weekly gains, but while Brent closed in on a full-year gain of more than 2 percent, US crude was on pace to post a 2012 decline of around 8 percent on accelerated domestic crude oil production.

Brent February fell 74 cents to $ 110.33 a barrel by 1721 GMT after reaching $ 111.33, Reuters reported. Brent fell to $ 110.10 in the session, encountering support above the 200-day moving average of $ 110.01.

U.S. February crude was down 55 cents at $ 90.43 a barrel, back below the 100-day moving average of $ 90.66 after reaching $ 91.44 during the session, its highest level since Oct. 19.

Total Brent and US crude trading volumes were 60 percent below their 30-day averages as the holidays kept volume thinned.

Brokers said few investors wished to make large bets on the direction of oil prices until the US budget talks were resolved, or during a holiday period characterized by low trading volumes.

Source: (c)2012 Arab News (Jeddah, Saudi Arabia). Distributed by MCT Information Services.

Story Tools Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters