IV:Crude oil eases off 4-month high with debt ceiling talks in focus
Investing.com - Crude oil futures edged lower in quiet trade during European morning hours on Monday, moving away from last week’s four-month high as ongoing worries over the U.S. debt ceiling debate dampened appetite for riskier assets.
On the New York Mercantile Exchange, light sweet crude futures for delivery in March traded at USD95.56 a barrel during European morning trade, down 0.5% on the day.
New York-traded oil prices fell by as much as 0.6% earlier in the day to hit a session low of USD95.53 a barrel. NY-oil futures touched a four-month high of USD96.48 a barrel on January 17.
Trade was expected to remain subdued on Monday, as floor trading on the NYMEX was to remain closed for the Martin Luther King Jr. holiday.
Oil traders continued to monitor political developments in the U.S., amid growing uncertainty over how the country will tackle the upcoming USD16.4 trillion debt ceiling debate.
House Republicans said Friday they would hold a vote on January 23 to grant a three-month debt limit extension to give Congress more time to pass a federal budget.
Failing to raise the debt ceiling by the end of February could lead to a first-ever U.S. default that could roil financial markets and weigh on demand for oil.
The U.S. is the world’s biggest oil-consuming country, responsible for almost 22% of global oil demand.
Meanwhile, investors were jittery as the euro group of euro zone finance ministers was to hold talks to discuss how the euro zone’s permanent bailout fund, the European Stability Mechanism can provide direct aid to banks.
On Friday Jean-Claude Juncker, the outgoing chairman of the eurogroup endorsed Dutch Finance Minister Jeroen Dijsselbloem as a "good" candidate to take over his job.
The appointment will be closely watched as the head of the eurogroup plays a vital role forming a policy response to the debt crisis.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for March delivery dipped 0.2% to trade at USD111.69 a barrel, with the spread between the Brent and crude contracts standing at USD16.13 a barrel.
