IV:Crude oil futures trade near 1-week low as demand concerns weigh
Investing.com - Crude oil futures extended losses from the previous session to trade close to a one-week low during European morning hours on Monday, as signs of slowing global economic activity and the impact on future oil demand prospects dampened the appeal of the commodity.
On the New York Mercantile Exchange, light sweet crude futures for delivery in April traded at USD96.12 a barrel during European morning trade, down 0.3% on the day.
New York-traded oil prices fell by as much as 1% earlier in the day to hit a session low of USD96.00 a barrel. Oil prices fell to USD95.23 a barrel on Friday, the weakest level since February 11.
Market sentiment remained on the back foot after data last week showed that the euro zone's economy contracted by 0.6% in the three months to December, compared to expectations for a 0.4% decline.
It was the fastest rate of decline since 2009 and marked a third consecutive quarter of contraction.
Also last week, official data showed that Japan’s economy contracted by 0.1% in the fourth quarter, compared to expectations for an uptick of 0.1%.
Meanwhile, in the U.S., data on Friday showed that industrial production contracted by 0.1% in January, missing expectations for a 0.2% rise and well below a 0.4% increase the previous month.
The downbeat global growth outlook prompted investors to shun riskier assets and move in to the relative safety of the U.S. dollar.
The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was up 0.3% to trade at 80.81, the highest level since January 4.
Dollar-denominated oil futures contracts tend to fall when the dollar rises, as this makes oil more expensive for buyers in other currencies.
Nymex floor trading will remain closed Monday for the Presidents’ Day holiday.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for April delivery added 0.15% to trade at USD117.85 a barrel, with spread between the Brent and crude contracts contracting to USD21.73 a barrel.
Brent prices found support after a report showed that oil shipments from top exporter Saudi Arabia declined for the third consecutive month in December to 7.06 million barrels per day, the lowest level in 15 months.
Oil traders are now looking ahead to talks between Iran and major world powers scheduled for February 26 for signs of progress regarding Tehran's disputed nuclear program.
