Investing.com - Crude oil futures traded lower on Monday, as Greece default fears persist and the U.S. dollar gained strength on euro zone worries.
On the New York Mercantile Exchange, light sweet crude futures for March settlement traded at USD96.67 a barrel during late U.S. trade falling 1.19%.
Crude oil hit a high of USD97.77 and a low of USD96.39 on the session.
Strength in the U.S. dollar helped depress crude oil prices. The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, gained 0.21% to 79.22.
Dollar strength generally depresses commodity prices, as it decreases their appeal as an alternative asset and makes dollar priced commodities more expensive for holders of other currencies.
Oil’s weakness was exasperated by renewed fears that Greece will fail to reach an acceptable deal with its private creditors.
This agreement is critical for Greece to avoid default on March 20 by obtaining its next tranche of bailout funds.
French President Nicolas Sarkozy met with German Chancellor Angela Merkel today in Paris regarding the Greek situation. Merkel stated, “I don’t understand why we need a few more days—time is running out”, adding to the negative sentiment on the session.
However, Greece’s Prime Minister Lucas Papedemos reached a tentative deal with leaders of the three parties supporting his interim government. The agreement is designed to boost economic competitiveness and extend spending cuts.
During a five hour meeting yesterday, the Greek leaders agreed to make additional spending reductions equaling 1.5% of the gross domestic product.
Furthermore, Greek’s largest public and private union groups, ADEDY and GSEE called a twenty four hour general strike to protest the austerity measures.
In additional oil bearish news, the International Monetary Fund stated that China’s economic expansion may be cut in half by the euro zone’s debt crisis.
This Chinese crisis would warrant significant fiscal stimulus from the nation’s government. The IMF went on to state that China’s growth would drop as much as four percentage points from the fund’s current projection for an expansion of 8.2% in 2012.
Over the weekend, Iran restated its threat to halt oil exports prior to the European embargo on July 1.
Additional worries about Israel launching an attack against Iranian nuclear installations increased the session’s tension
Elsewhere, on the ICE Futures Exchange, Brent oil futures for March delivery advanced 1.22% to trade at USD115.97 a barrel, up USD19.30 on its U.S. Counterpart.
The spread hit a record high of USD27.88 a barrel in October 2011.
On the New York Mercantile Exchange, light sweet crude futures for March settlement traded at USD96.67 a barrel during late U.S. trade falling 1.19%.
Crude oil hit a high of USD97.77 and a low of USD96.39 on the session.
Strength in the U.S. dollar helped depress crude oil prices. The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, gained 0.21% to 79.22.
Dollar strength generally depresses commodity prices, as it decreases their appeal as an alternative asset and makes dollar priced commodities more expensive for holders of other currencies.
Oil’s weakness was exasperated by renewed fears that Greece will fail to reach an acceptable deal with its private creditors.
This agreement is critical for Greece to avoid default on March 20 by obtaining its next tranche of bailout funds.
French President Nicolas Sarkozy met with German Chancellor Angela Merkel today in Paris regarding the Greek situation. Merkel stated, “I don’t understand why we need a few more days—time is running out”, adding to the negative sentiment on the session.
However, Greece’s Prime Minister Lucas Papedemos reached a tentative deal with leaders of the three parties supporting his interim government. The agreement is designed to boost economic competitiveness and extend spending cuts.
During a five hour meeting yesterday, the Greek leaders agreed to make additional spending reductions equaling 1.5% of the gross domestic product.
Furthermore, Greek’s largest public and private union groups, ADEDY and GSEE called a twenty four hour general strike to protest the austerity measures.
In additional oil bearish news, the International Monetary Fund stated that China’s economic expansion may be cut in half by the euro zone’s debt crisis.
This Chinese crisis would warrant significant fiscal stimulus from the nation’s government. The IMF went on to state that China’s growth would drop as much as four percentage points from the fund’s current projection for an expansion of 8.2% in 2012.
Over the weekend, Iran restated its threat to halt oil exports prior to the European embargo on July 1.
Additional worries about Israel launching an attack against Iranian nuclear installations increased the session’s tension
Elsewhere, on the ICE Futures Exchange, Brent oil futures for March delivery advanced 1.22% to trade at USD115.97 a barrel, up USD19.30 on its U.S. Counterpart.
The spread hit a record high of USD27.88 a barrel in October 2011.