MW: Oil futures lose more ground on Europe worries
Prices hovering at lowest since early February
By Claudia Assis and Michael Kitchen, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil prices traded under $98 a barrel Monday, adding to heavy losses made the previous week as election results in Europe drove up investor anxiety.
Crude for June CLM2 -1.24% fell $1.12, or 1.1%, to $97.35 a barrel on the New York Mercantile Exchange. Prices dropped 4% on Friday, when oil settled at its lowest since early February and notched a weekly loss of 6.1%.
Prices traded as low as $95.34 a barrel, according to FactSet Research.
The losses followed key election results from Greece and France.
Early polls from Greece suggested two major parties that backed the nation’s fiscal bailout and austerity package had fared poorly, raising the possibility of a change in government and rejection of the financial aid needed to meet Greece’s borrowing obligations.
In France, Socialist candidate François Hollande defeated incumbent Nicolas Sarkozy, as analysts had predicted, raising questions about France’s own commitment to austerity measures. Read more on European election results.
Oil prices had already suffered Friday after data showed weaker-than-expected U.S. job growth in April. See report on Friday’s crude-oil trading.
Beyond the headlines, “the underlying fundamentals for the crude-oil market have been weakening for some time,” analysts at Citigroup said.
“Demand growth has been inhibited by high prices, while [the Organization of the Petroleum Exporting Countries’] production discipline has been discouraged,” they said, also citing a rise in U.S. crude production and the unwinding of long positions held by money managers.
Most other energy futures moved lower Monday, with June gasoline RBM2 -0.53% shedding 2 cents, or 0.5%, to $2.96 a gallon, and June heating oil HOM2 -0.94% down 3 cents, or 0.9%, at $2.98 a gallon.
June natural gas NGM12 +2.15% bucked the trend, climbing 4 cents, or 1.8%, to trade at $2.32 per million British thermal units.
Claudia Assis is a San Francisco-based reporter for MarketWatch.
Michael Kitchen is Asia editor for MarketWatch and is based in Los Angeles.
