Investing.com - Crude oil futures rebounded from a five-month low during European morning trade on Tuesday, as appetite for riskier assets improved after German gross domestic product figures came in significantly better than expected.
On the New York Mercantile Exchange, light sweet crude futures for delivery in June traded at USD94.88 a barrel during European morning trade, easing up 0.1%.
It earlier fell by as much as 0.5% to trade at USD93.97 a barrel, the lowest since December 19, 2011.
Oil futures sank to the lowest level since the start of the year on Monday, as investors cut their exposure to growth-linked assets amid growing concerns over a potential Greek exit from the euro zone.
But prices recovered slightly on Tuesday as sentiment improved after better-than-expected German economic growth data.
Preliminary data showed that Germany’s economy expanded more-than-expected in the first quarter, indicating that the euro zone’s largest economy is weathering the effects of the crisis in the region.
Germany’s gross domestic product grew by a seasonally adjusted 0.5% in the three months to March, above expectations for a growth of 0.1%. German GDP contracted by an unrevised 0.2% in the fourth quarter of 2011.
But investors continued to monitor political developments in Greece, as the debt-laden country struggles to form a coalition government following last weekend’s elections, fanning fears over a potential Greek default and eventual exit from the euro zone.
Greece’s President Karolos Papoulias was due to hold a fresh round of cross party talks aimed at forming a government later in the day, after a more than week-long political stalemate.
There are worries that the region’s sovereign debt crisis could trigger a broader economic slowdown that would curb demand for oil. The euro zone accounted for nearly 12% of global oil consumption in 2010, according to data from British Petroleum.
Meanwhile, market participants were awaiting fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of oil demand in the world’s largest oil consumer.
The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show crude stockpiles rose by 1.54 million barrels last week to the highest level since August 1990, underscoring fears over a slowdown in oil demand from the U.S.
The U.S. is the world’s biggest oil-consuming country, responsible for almost 22% of global oil demand.
Nymex crude prices have come under heavy selling pressure over the past week, losing nearly 10.5% since May 1, as concerns lingered over a widening economic slowdown that may cut demand for energy and as tensions have eased between Iran and Western nations over the country’s nuclear program.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for July delivery added 0.1% to trade at 111.09 a barrel, with the spread between the Brent and crude contracts standing at USD16.21.
Brent crude, the European benchmark, is more than 13% off its intraday high of USD128.38 hit on March 1.
A potential loss of Iranian oil supplies has helped underpin strong gains in oil prices during late last year and the first quarter of this year.
But revived talks between Iran and major powers over Tehran's nuclear ambitions, along with rising Saudi Arabian and Libyan output and signs of slower U.S. economic and employment growth, helped pull oil prices back from first-quarter highs.
On the New York Mercantile Exchange, light sweet crude futures for delivery in June traded at USD94.88 a barrel during European morning trade, easing up 0.1%.
It earlier fell by as much as 0.5% to trade at USD93.97 a barrel, the lowest since December 19, 2011.
Oil futures sank to the lowest level since the start of the year on Monday, as investors cut their exposure to growth-linked assets amid growing concerns over a potential Greek exit from the euro zone.
But prices recovered slightly on Tuesday as sentiment improved after better-than-expected German economic growth data.
Preliminary data showed that Germany’s economy expanded more-than-expected in the first quarter, indicating that the euro zone’s largest economy is weathering the effects of the crisis in the region.
Germany’s gross domestic product grew by a seasonally adjusted 0.5% in the three months to March, above expectations for a growth of 0.1%. German GDP contracted by an unrevised 0.2% in the fourth quarter of 2011.
But investors continued to monitor political developments in Greece, as the debt-laden country struggles to form a coalition government following last weekend’s elections, fanning fears over a potential Greek default and eventual exit from the euro zone.
Greece’s President Karolos Papoulias was due to hold a fresh round of cross party talks aimed at forming a government later in the day, after a more than week-long political stalemate.
There are worries that the region’s sovereign debt crisis could trigger a broader economic slowdown that would curb demand for oil. The euro zone accounted for nearly 12% of global oil consumption in 2010, according to data from British Petroleum.
Meanwhile, market participants were awaiting fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of oil demand in the world’s largest oil consumer.
The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show crude stockpiles rose by 1.54 million barrels last week to the highest level since August 1990, underscoring fears over a slowdown in oil demand from the U.S.
The U.S. is the world’s biggest oil-consuming country, responsible for almost 22% of global oil demand.
Nymex crude prices have come under heavy selling pressure over the past week, losing nearly 10.5% since May 1, as concerns lingered over a widening economic slowdown that may cut demand for energy and as tensions have eased between Iran and Western nations over the country’s nuclear program.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for July delivery added 0.1% to trade at 111.09 a barrel, with the spread between the Brent and crude contracts standing at USD16.21.
Brent crude, the European benchmark, is more than 13% off its intraday high of USD128.38 hit on March 1.
A potential loss of Iranian oil supplies has helped underpin strong gains in oil prices during late last year and the first quarter of this year.
But revived talks between Iran and major powers over Tehran's nuclear ambitions, along with rising Saudi Arabian and Libyan output and signs of slower U.S. economic and employment growth, helped pull oil prices back from first-quarter highs.