MW: Oil dips as G-20 sees ‘risks’ of higher prices
By Clare Hutchison, MarketWatch
LONDON (MarketWatch) — Crude-oil futures retreated from eight-month highs in European trading on Monday, as fears that higher oil prices could derail the global economic recovery grew.
Crude-oil futures for April CLJ2 -1.22% delivery slipped $1.15, or 1%, to $109.03 in electronic trading.
The same contract trading on the New York Mercantile Exchange ended the previous session with it’s largest weekly percentage advance since Dec. 23.
Oil’s recent rally stemmed from concerns about supply disruptions, chiefly from Iran, which is to be subject to a European Union boycott on oil exports from July.
U.S. Treasury Secretary Tim Geithner told CNBC television Friday that the U.S. may even look into using some of its strategic oil reserves to minimize the risk posed by the reduced Iranian supplies.
The rising oil price was discussed at a meeting of finance ministers and central bank representatives from the G-20 group in Mexico City on Sunday.
In a statement, the group said it is “alert to the risks of higher oil prices.” The G-20 also responded to a promise from Saudi Arabia, one of the world’s top oil-producers, to pump oil at the country’s full capacity. “[We] welcome the commitment by producing countries to continue to ensure adequate supply,” the statement said.
The higher prices appeared to drag on European bourses. The Stoxx Europe 600 XX:SXXP -0.88% was 0.9% off in early-afternoon trading in Europe.
Other energy prices also pulled back, with the March heating-oil futures contract HOH2 -0.91% down 3 cents, or 1.1%, to $3.28 a gallon. Gasoline futures for the same month RBH2 -1.09% dipped 2 cents, or 0.7%, to $3.30 a gallon. Natural-gas futures for March delivery NGH12 -1.88% were flat at $2.69 per million British thermal units.
