Investing.com – Crude oil futures erased gains on Monday, pulling back from a four-week high as appetite for riskier assets weakened after Germany’s finance minister said the upcoming European Union summit would not present a solution to the region’s debt crisis.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at USD86.48 a barrel during U.S. morning trade, shedding 0.6%.
It earlier fell by as much as 0.9% to trade at a daily low of USD86.12 a barrel.
Hopes for a plan to resolve the financial crisis in the euro zone were dented after German Finance Minister Wolfgang Schaeuble said the EU summit due to be held on October 23 would not yield a definitive solution to the crisis.
His comments came after German Chancellor Angela Merkel said "the dream of resolving all problems at the EU summit" was impossible.
The comments saw risk aversion sharpen, boosting demand for the safe haven U.S. dollar. The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was up 0.65% to trade at 77.38, reversing an earlier loss of as much as 0.25%.
A stronger dollar makes U.S. commodities more expensive for importers holding other currencies such as yen or euro.
Crude prices came under further pressure after the New York Federal Reserve’s index of manufacturing conditions improved less-than-expected in October, remaining in negative territory for the fifth consecutive month.
The FRBNY said that its general business conditions index improved by 0.3 points to minus 8.5 in October from minus 8.8 in September. Analysts had expected the index to improve to minus 4.0 in October.
The U.S. is the world’s largest oil consuming nation and manufacturing numbers are used as indicators for fuel demand growth.
Crude oil futures rose to a four-week high of USD88.40 a barrel earlier amid hopes for a comprehensive plan to restructure Greek debt, recapitalize European banks and bolster the euro zone’s bailout fund in time for the summit.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for December delivery dropped 1.12% to trade at USD110.97 a barrel.
The spread between the Brent and the crude contracts narrowed to USD24.49 a barrel, after hitting a record high USD28.10 a barrel on Friday, when the November Brent contract expired.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at USD86.48 a barrel during U.S. morning trade, shedding 0.6%.
It earlier fell by as much as 0.9% to trade at a daily low of USD86.12 a barrel.
Hopes for a plan to resolve the financial crisis in the euro zone were dented after German Finance Minister Wolfgang Schaeuble said the EU summit due to be held on October 23 would not yield a definitive solution to the crisis.
His comments came after German Chancellor Angela Merkel said "the dream of resolving all problems at the EU summit" was impossible.
The comments saw risk aversion sharpen, boosting demand for the safe haven U.S. dollar. The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was up 0.65% to trade at 77.38, reversing an earlier loss of as much as 0.25%.
A stronger dollar makes U.S. commodities more expensive for importers holding other currencies such as yen or euro.
Crude prices came under further pressure after the New York Federal Reserve’s index of manufacturing conditions improved less-than-expected in October, remaining in negative territory for the fifth consecutive month.
The FRBNY said that its general business conditions index improved by 0.3 points to minus 8.5 in October from minus 8.8 in September. Analysts had expected the index to improve to minus 4.0 in October.
The U.S. is the world’s largest oil consuming nation and manufacturing numbers are used as indicators for fuel demand growth.
Crude oil futures rose to a four-week high of USD88.40 a barrel earlier amid hopes for a comprehensive plan to restructure Greek debt, recapitalize European banks and bolster the euro zone’s bailout fund in time for the summit.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for December delivery dropped 1.12% to trade at USD110.97 a barrel.
The spread between the Brent and the crude contracts narrowed to USD24.49 a barrel, after hitting a record high USD28.10 a barrel on Friday, when the November Brent contract expired.