IV:Crude oil futures edge lower as U.S. government shutdown begins
Investing.com - Crude oil futures declined on Tuesday, amid concerns a partial shutdown of the U.S. government will create a drag on fourth quarter U.S. economic growth.
On the New York Mercantile Exchange, light sweet crude futures for delivery in November traded at USD102.13 a barrel during European morning trade, down 0.2%.
New York-traded oil futures fell by as much as 0.45% earlier in the session to hit a daily low of USD101.85 a barrel. The November contract settled down 0.52% at USD102.33 a barrel on Monday.
Oil futures were likely to find near-term support at USD101.06 a barrel, Monday’s low and resistance at USD103.77 a barrel, the high from September 27.
The U.S. government began a partial shutdown after lawmakers failed to reach an agreement on a new budget before Monday's midnight deadline. It is the first government shutdown in the U.S. since 1996.
Lawmakers are expected to continue negotiating a funding measure later in the day in hopes of reaching a compromise.
Republicans have insisted on delaying the implementation of President Obama's health care reforms as a condition for passing the budget.
Later this month, Congress will have to extend the U.S. debt ceiling which the U.S. Treasury Department has estimated will be reached by October 17.
Moody's Investors Service warned that a failure to raise the debt limit would result in a worse outcome for financial markets than a government shutdown.
Meanwhile, in China, government data released earlier in the day showed that the nation’s official manufacturing purchasing managers' index inched up to 51.1 in September from 51.0 in August, missing forecasts for 51.5.
The disappointing data indicated that the recovery in the world’s second largest economy remains fragile.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for November delivery dropped 0.25% to trade at USD108.10 a barrel, with the spread between the Brent and crude contracts standing at USD5.97 a barrel.
