By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) — Crude-oil futures extended losses on Tuesday in European trading hours, against a backdrop of weaker global markets as investors continued to eye European political events and fret over the pace of global growth.
Oil futures for June delivery CLM2 -1.16% fell $1, or 1%, to $96.94 a barrel, following a drop of 55 cents the prior session to the lowest level for a front-month contract since Feb. 6.
Oil fell Monday in the wake of a string of elections in Europe--France, Germany and Greece--that saw investors reject established leaders, with Socialist challenger François Hollande defeating incumbent French President Nicolas Sarkozy. Greece is also now locked in political turmoil after weekend parliamentary elections left the country’s parties struggling to form a majority.
Growth concerns are weighing across Europe as well as the U.S., and investors are also concerned that will cut into demand for commodities such as oil. Analysts from the Schork Report said that “while it’s easy to malign the European recovery, the latest round of U.S. macroeconomic data is troubling in itself.”
The analysts pointed to the weaker-than-expected rise in April nonfarm payrolls last Friday along with a factory-orders drop in March that showed a 33.8% decline in orders for the transportation sector, aircraft and parts.
“Not only does the aviation sector account for the U.S.’s largest single source of export revenue, a slowdown in orders is also reflective of weaker global demand,” said the analysts.
Gold was also trading lower on Tuesday, while the dollar rose. U.S. stock futures pointed to a lower open for Wall Street, while Europe stocks were lower and Asian markets rebounded except for China.
Among other energy futures, June gasoline RBM2 -0.27% was flat at $2.97 a gallon, while June heating oil HOM2 -0.15% was also flat at $2.98 a gallon.
June natural gas NGM12 -0.09% was flat at $2.33 per million British thermal units.
Barbara Kollmeyer is an editor for MarketWatch in Madrid.
