BLBG:Oil Declines After Biggest Gain Since 2009 On Europe Concerns
Oil declined in New York as euro-area unemployment reached the highest level on record, prompting speculation that crude’s surge last week, its biggest in three years, may have been excessive.
The jobless rate in the 17-nation area rose to 11.1 percent in May from 11 percent in April, the European Union’s statistics office in Luxembourg said today. That’s the highest since the data series started in 1995. China’s manufacturing activity slowed in June, according to HSBC Holdings Plc and Markit Economics. An EU embargo on Iranian oil started yesterday.
“Crude’s strong movement last week was a bit too much too fast probably, so today we’re seeing it a bit lower again,” said Hannes Loacker, an analyst at Raiffeisen Bank International AG in Vienna, who correctly predicted Brent crude would rebound at the end of last month. “Headwinds from the euro zone” may delay oil’s recovery, he said.
Crude for August delivery dropped as much as $1.44 to $83.52 a barrel in electronic trading on the New York Mercantile Exchange and was at $83.65 at 10:11 a.m. London time. The contract gained $7.27 on June 29 to $84.96, the highest close since June 7. Prices decreased 18 percent last quarter, the most since the final three months of 2008, and slipped 1.8 percent last month.
Brent oil for August settlement on the London-based ICE Futures Europe exchange fell as much as $1.88, or 1.9 percent, at $95.92 a barrel. The European benchmark crude was at a $12.39 premium to New York contracts compared with $12.84 on June 29.
To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net
To contact the editor responsible for this story: Stephen Voss on sev@bloomberg.net
