Oil falls as European elections add to uncertainty
NEW YORK, May 7 — Oil prices fell today as European election results revived worries about efforts to contain the euro zone debt crisis after weak US employment data had increased concerns about slowing economic growth and demand for petroleum.
Crude futures fell for a fourth straight session as the outcome of elections in France and Greece raised doubts about the region’s ability to proceed with austerity measures seen as needed to tackle the region’s economic woes and soaring debt.
Brent and US crude managed some recovery from multimonth lows hit early that attracted bargain hunters.
The euro dropped broadly on the renewed worries about the stability of the euro zone and the dollar index strengthened, weighing on oil and other dollar-denominated commodities such as copper and gold.
“Optimists who recently believed that most of the risks concerning the euro were already ‘priced in’ are now discovering that this is by no means the case,” Commerzbank analysts Carsten Fritsch and Eugen Weinberg said in a note.
“We believe that this will weigh on the euro, market sentiment and commodity prices for some time to come.”
Brent June crude was down 90 cents at US$112.28 (RM344.70) a barrel at 10:31am EDT (1431 GMT). It earlier slumped to US$110.34, the lowest intraday price since January 30 and marking a 14 per cent retreat from the 2012 peak of US$128.40 hit in March.
US June crude fell US$1.70 to US$96.79 a barrel, having recovered from US$95.34, the lowest intraday price since December 20. — Reuters