Investing.com - Crude oil futures came under pressure for a sixth day during European morning trade on Wednesday, as investors continued to cut their exposure to growth-linked assets amid concerns over the impact of weekend elections in Greece on the euro zone’s ongoing debt crisis.
On the New York Mercantile Exchange, light sweet crude futures for delivery in June traded at USD96.47 a barrel during European morning trade, retreating 0.55%.
It earlier fell by as much as 0.8% to trade at a session low of USD96.27 a barrel. Prices touched USD95.36 a barrel on Monday, the lowest since December 20, 2011. The six-day decline is the longest since July 2010.
Investors continued to monitor political developments in Greece, as the debt-laden country struggles to form a coalition government following weekend elections.
Speculation that Greece’s new government will reject terms of its financial rescue grew after Alexis Tsipras, the leader of the leftist Syriza party who is in charge of forming a coalition, declared Tuesday that Greece's financial aid package is null and void, and called for a moratorium on Greek debt payments.
The political uncertainty fuelled fears that Greece will not have a government in place in time to secure its next tranche of international aid next month, as new elections look increasingly likely, fanning fears over a potential default and exit from the euro zone.
Investors were also eyeing developments in France, as Socialist President-elect Francois Hollande has advocated an approach to tackling the debt crisis centered more on growth, which may create tensions with Germany's insistence on fiscal austerity.
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.
Prices came under further pressure after Saudi Arabia’s Oil Minister Ali al-Naimi said earlier that the oil market is oversupplied by as much as 1.5 million barrels per day.
His comments came a day after saying that his country was pumping around 10 million barrels of oil per day and that the Kingdom was storing as much as 80 million barrels of crude to boost global supplies in response to prices that are “still a little bit high.”
Meanwhile, oil traders were looking ahead to the U.S. Energy Information Administration’s closely-watched weekly report on U.S. stockpiles of crude and refined products later in the day.
The report was expected to show that U.S. crude oil stockpiles rose by 2.0 million barrels last week to the highest level since September 1990, underscoring fears over a slowdown in oil demand from the U.S.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories rose by 7.78 million barrels last week to 378 million, the highest since August 1990.
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 9% since May 2, 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 June delivery was down 0.45% to trade at 112.23 a barrel, with the spread between the Brent and crude contracts standing at USD15.76.
Brent crude, the European benchmark, is more than 12% 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 USD96.47 a barrel during European morning trade, retreating 0.55%.
It earlier fell by as much as 0.8% to trade at a session low of USD96.27 a barrel. Prices touched USD95.36 a barrel on Monday, the lowest since December 20, 2011. The six-day decline is the longest since July 2010.
Investors continued to monitor political developments in Greece, as the debt-laden country struggles to form a coalition government following weekend elections.
Speculation that Greece’s new government will reject terms of its financial rescue grew after Alexis Tsipras, the leader of the leftist Syriza party who is in charge of forming a coalition, declared Tuesday that Greece's financial aid package is null and void, and called for a moratorium on Greek debt payments.
The political uncertainty fuelled fears that Greece will not have a government in place in time to secure its next tranche of international aid next month, as new elections look increasingly likely, fanning fears over a potential default and exit from the euro zone.
Investors were also eyeing developments in France, as Socialist President-elect Francois Hollande has advocated an approach to tackling the debt crisis centered more on growth, which may create tensions with Germany's insistence on fiscal austerity.
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.
Prices came under further pressure after Saudi Arabia’s Oil Minister Ali al-Naimi said earlier that the oil market is oversupplied by as much as 1.5 million barrels per day.
His comments came a day after saying that his country was pumping around 10 million barrels of oil per day and that the Kingdom was storing as much as 80 million barrels of crude to boost global supplies in response to prices that are “still a little bit high.”
Meanwhile, oil traders were looking ahead to the U.S. Energy Information Administration’s closely-watched weekly report on U.S. stockpiles of crude and refined products later in the day.
The report was expected to show that U.S. crude oil stockpiles rose by 2.0 million barrels last week to the highest level since September 1990, underscoring fears over a slowdown in oil demand from the U.S.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories rose by 7.78 million barrels last week to 378 million, the highest since August 1990.
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 9% since May 2, 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 June delivery was down 0.45% to trade at 112.23 a barrel, with the spread between the Brent and crude contracts standing at USD15.76.
Brent crude, the European benchmark, is more than 12% 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.