↑ Scroll to top

Oil extends losses as eurozone optimism fades

Published: June 12, 2012 | 7:18 am
Text size: -A +A

SINGAPORE – Oil extended its losses in Asian trade Tuesday as euphoria over a weekend bailout deal for Spanish banks faded amid renewed concerns over the troubled eurozone.

Expectations that the Organization of the Petroleum Exporting Countries (OPEC) will raise its production quota also pressured prices.

New York’s main contract, light sweet crude for delivery in July, was down 70 cents at $82.00 a barrel, a level last seen in October.

Brent North Sea crude for July delivery shed 40 cents to $97.60 in the afternoon.

“Oil tumbled… as fears that the eurozone debt crisis will engulf more countries and threaten petroleum demand reversed a rally sparked by Europe’s plan to rescue Spanish banks,” said Phillip Futures in a market commentary.

“Also pressuring prices, top exporter Saudi Arabia said OPEC may need to raise oil output targets at its Thursday meeting in Vienna,” it added.

Analysts have turned cautious as recognition sank in that Spain still faced deep financial difficulties, while Greece’s general election — which could decide whether the country stays in the eurozone — is only days away.

The situation in Italy is also being closely watched, as the rate of return on its 10-year bonds on Monday briefly soared above the six percent barrier which is seen as being unsustainable in the medium term.

OPEC’s ministerial meeting Thursday could set the scene for further declines in oil prices as Saudi Arabia looks set to push through its plan to raise output quotas.

The 12-member cartel pumps one third of the world’s crude supplies.

© 1994-2012 Agence France-Presse

VN:F [1.9.10_1130]
Rating: 0 (from 0 votes)
Share on Facebook Share on Twitter
More posts in category: Latest News
  • Blues pair frustrate Pulis
  • Fearless faces! – Confident Girlz ready for tough CONCACAF assignment
  • Monaco interested in Beckham
  • The Hottest Cars At The Geneva Auto Show