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Crude oil futures ease after Iranian threats spark rally

Published 12/13/2011, 08:28 PM
Updated 12/13/2011, 08:32 PM
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Investing.com - Talk out of Iran that the oil-rich country may disrupt operations in a key supply waterway sent crude oil futures rising worldwide Wednesday to the point they tempered in Asian trading after breaking the USD100 per-barrel mark.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in January traded at USD99.88 a barrel in early Asian trading, down 0.26%, taking a breather after the earlier rally.

The commodity hit a session high of USD100.37 and a low of 99.77.

Earlier Wednesday, Iranian officials were reported to be considering conducting military drills in the Strait of Hormuz, which spooked the oil market.

The Strait of Hormuz links Iran, the Arabian peninsula and the Persian Gulf with the Indian Ocean, and talk of geopolitical disruptions in the choke point raised supply fears.

Furthermore, the U.S. Federal Reserve earlier left open the possibility that fresh monetary easing could be possible next year, which would flood global markets with fresh dollars and send oil prices climbing if it happened.

Meanwhile the dollar, which often trades inversely from oil, was down as well

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was off 0.05% at 80.92 on Wednesday.

Elsewhere, on the ICE Futures Exchange, Brent oil futures for February delivery were down 0.19%, trading at USD108.67 a barrel, up USD8.79 on its U.S. counterpart.

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




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