By Claudia Assis and Virginia Harrison, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures declined Monday as U.S. lawmakers failed to reach an agreement on the country’s debt-ceiling over the weekend, stoking fears about diminished energy demand.
Crude for September delivery CL1U -0.89% lost $1.17, or 1.2%, to $98.74 a barrel on the New York Mercantile Exchange. It had traded as low as $98.52 a barrel earlier.
The loss snapped four days of gains for oil. Concerns over a lack of resolution in the U.S. debt-ceiling talks created uncertainty in the U.S. economic outlook and thus for energy demand.
Negotiations between U.S. lawmakers wrapped up on Sunday in Washington without a clear path ahead to lift the debt-ceiling. The $14.3 trillion debt ceiling needs to be raised by Aug. 2 or the government would be at risk of defaulting on its obligations. Read more about U.S. debt negotiations.
“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 prices over the rest of the quarter,” analysts at Barclays Capital said.
The fall for crude came despite a weaker dollar, which traded lower on the U.S. debt impasse.
The dollar index DXY -0.05% , which compares the U.S. unit to a basket of six other currencies, traded at 74.156, down from 74.196 in North American trade late Friday. Read more on currencies.
The greenback tends to trade inversely dollar-priced commodities such as crude, as it makes them cheaper to holders of other currencies.
Other energy products tracked oil lower, with natural-gas futures the outlier.
Natural gas for August delivery NG11Q +0.95% added less than a penny, or 0.1%, to $4.41 per million British thermal units.
August gasoline RB1Q -0.98% lost 2 cents, or 0.9%, to $3.11 per gallon.
Claudia Assis is a San Francisco-based reporter for MarketWatch.
Virginia Harrison is a MarketWatch reporter based in Sydney.
