-- Brent could revisit $100-a-barrel level this week, analyst says
By Konstantin Rozhnov
LONDON--Crude-oil futures fell sharply Monday on worries over global demand for oil, as the euro-zone's sovereign debt crisis pushed down European stocks and the euro.
"Focus is back on Europe, and there's a bit of a nervousness in the market," said Ole Hansen head of commodity strategy at Saxo Bank.
At 1115 GMT, the front-month September Brent contract on London's ICE futures exchange was $2.90, or 2.7%, lower at $103.93 per barrel. The front-month September contract on the New York Mercantile Exchange was trading down $2.65, or 2.9%, at $89.18 per barrel.
The soaring cost of Spanish government borrowing costs and worries over Greece ended the $10-a-barrel rise in oil prices which lasted for seven trading days up to last Thursday, analysts said.
"This price rise wasn't the result of any change in fundamentals but to supply risks," Commerzbank said in a note. "Although these supply risks haven't gone away [...] they are likely to merely slow the price slide so long as there is no further escalation of the situation in Syria or of the Iran conflict."
Also, activity in the oil futures market is relatively light now due to the summer holiday season and it doesn't take much to move the market, said Mr Hansen.
Without an increase in geopolitical tensions or strong indications of new monetary stimulus measures to boost economic growth, Brent crude could revisit the $100-per-barrel level this week, Mr Hansen said.
"In the longer run, London's crude is well supported near $97 [per barrel]," said VTB Capital analyst Andrey Kryuchenkov.
At 1115 GMT, the ICE's gasoil contract for August delivery was down $18.00, or 2%, at $901.50 per metric ton, while Nymex gasoline for August delivery was 649 points, or 2.2%, lower at $2.8781 per gallon.
Write to Konstantin Rozhnov at konstantin.rozhnov@dowjones.com
