Investing.com – Crude oil futures extended losses on Monday, falling below USD99 a barrel as fears over a possible U.S. sovereign debt default sparked concerns over the short-term energy demand outlook from the world’s largest oil consumer.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in September traded at USD98.88 a barrel during U.S. morning trade, dropping 0.9%.
It earlier fell as much as 1.1% to trade at a daily low of USD98.55 a barrel.
Talks between Democrats and Republicans from the U.S. Congress broke down over the weekend, prompting White House Chief of Staff Bill Daley to warn that there would be a "few stressful days" ahead for financial markets, as the deadline to raise the USD14.3 trillion debt ceiling was only nine days away.
On Sunday, Democrats and Republicans from the U.S. Congress split into two camps and were reportedly working on two separate budget proposals after House Speaker John Boehner told Republican lawmakers that no "grand deal" on raising the debt ceiling was possible with President Barack Obama.
Any budget plan to raise the debt limit must pass both the Republican-controlled House and the Democratic-run Senate and be signed by President Obama.
Rating agency Standard & Poor's last week reiterated that there was a 50-50 chance the U.S. AAA credit rating could be cut within three months if a deal isn’t accompanied by a “credible solution” on the debt burden.
Global financial service provider Barclays said in a report earlier Monday that, “The U.S. remains a source of constant concern, and overall sovereign debt is likely to remain a major dampening force to the upside to energy prices over the rest of the quarter.”
Adding to global concerns, ratings agency Moody’s downgraded Greece’s sovereign debt by three notches to Ca from Caa1 earlier in the day, saying the country still faced serious medium term solvency challenges despite the fresh bailout package.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for September delivery sank 1% to trade at USD117.34 a barrel, up USD18.46 on its U.S. counterpart.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in September traded at USD98.88 a barrel during U.S. morning trade, dropping 0.9%.
It earlier fell as much as 1.1% to trade at a daily low of USD98.55 a barrel.
Talks between Democrats and Republicans from the U.S. Congress broke down over the weekend, prompting White House Chief of Staff Bill Daley to warn that there would be a "few stressful days" ahead for financial markets, as the deadline to raise the USD14.3 trillion debt ceiling was only nine days away.
On Sunday, Democrats and Republicans from the U.S. Congress split into two camps and were reportedly working on two separate budget proposals after House Speaker John Boehner told Republican lawmakers that no "grand deal" on raising the debt ceiling was possible with President Barack Obama.
Any budget plan to raise the debt limit must pass both the Republican-controlled House and the Democratic-run Senate and be signed by President Obama.
Rating agency Standard & Poor's last week reiterated that there was a 50-50 chance the U.S. AAA credit rating could be cut within three months if a deal isn’t accompanied by a “credible solution” on the debt burden.
Global financial service provider Barclays said in a report earlier Monday that, “The U.S. remains a source of constant concern, and overall sovereign debt is likely to remain a major dampening force to the upside to energy prices over the rest of the quarter.”
Adding to global concerns, ratings agency Moody’s downgraded Greece’s sovereign debt by three notches to Ca from Caa1 earlier in the day, saying the country still faced serious medium term solvency challenges despite the fresh bailout package.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for September delivery sank 1% to trade at USD117.34 a barrel, up USD18.46 on its U.S. counterpart.