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Crude oil futures dip on revived European meltdown fears

Published 12/12/2011, 08:50 PM
Updated 12/12/2011, 08:56 PM
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Investing.com - Crude oil futures softened in early Asian trading Tuesday, extending losses from earlier European and U.S. sessions on fears that Europe's debt crisis was far from abating, while Chinese trade figures suggested the Asian economic giant may still be in a cooling-off phase.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in January traded at USD97.69 a barrel in early Asian trading, down 0.08%.

The commodity dipped to USD97.65 a barrel earlier in the session and topped out at USD97.96.

On Friday, the European Union agreed on greater fiscal integration to battle the debt crisis there.

While investors were happy with Europe's commitments to tackle the crisis, they weren't euphoric, which made markets ripe for a sell-off when Moody's Investors Service said it wasn't impressed with the summit and reiterated downgrades were possible.

Fears of continued economic woes in Europe coupled with news that Chinese exports rose only 13.8% in November, failing to beat a previous gain of 15.9% in October, primed concerns that the global economy remains vulnerable to a slowdown, and a slower economy needs less oil to run.

Meanwhile the dollar, which often trades inversely from oil, was up.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.05% at 80.27 on Tuesday.

Elsewhere, on the ICE Futures Exchange, Brent oil futures for February delivery were down 0.22%, trading at USD106.92 a barrel, up USD9.23 from the blend's U.S. counterpart.

The gap in price between the two contracts hovers just below the midway point between the nearly USD20.00 gap all-time high and a historical spread of USD1.00.




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