Investing.com - Crude oil futures moved lower in Asian trade Tuesday, falling back from earlier gains on hopes for a new package of measures to recapitalize Europe’s ailing financial institutions.
On the New York Mercantile Exchange light, sweet crude futures for November delivery traded at USD85.51 a barrel during early Asian trade, falling 0.27%, after hitting a daily high of USD85.94.
Over the weekend, German Chancellor Angela Merkel and French President Nicolas Sarkozy, said that they had agreed to strengthen European banks and that specifics of a package of measures would be revealed by the end of the month.
Meanwhile, the troika of international lenders, the European Union, the International Monetary Fund and the European Central Bank were set to conclude review meetings with Greek officials in Athens.
A favorable report could clear the way for the release of a USD10.8 billion rescue package for Greece it needs by the middle of next month in order to to avoid debt default.
Wall Street shares reacted positively to the news from Europe, with the Dow Jones Industrial Average gaining 2.97%, the Nasdaq Composite Index jumped 3.5%, and the S&P 500 was up sharply by 3.41%.
Meanwhile, German financial provider Commerzbank said that it expected crude oil to trade at between USD80 and USD90 for the short term, citing uncertainty over the global economic outlook and its impact on oil demand.
Brent oil futures were given a lift as Nigerian oil unions began a three-day strike. Nigeria , Africa’s largest oil producer, produces about 1.9 million barrels a day, according to the U.S. Energy Information Administration.
A rising U.S. dollar contributed to lower oil futures, as dollar-denominated futures contracts tend to fall when the dollar rises.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, inched higher by 0.16% to 78.00.
On the ICE Futures Exchange Brent oil futures for November delivery added 0.09% to trade at USD107.08.