Crude oil recovered from the six weeks low in New York as the equities advanced. The debt crisis seems no more to be a stern concern following the European government measures. The earlier losses that crude oil made were erased off and increased by 0.5 percent to reach $94 per barrel.
Meanwhile the European Finance Minister has scheduled a conference to address the deadlines for drawing out additional aids and designing new budget rules. Further a report from the Bank of America Corp. said that halt in Iranian production could lead to a rise in crude prices by $40 per barrel.
Crude oil on the New York Mercantile Exchange, which is up for January delivery, witnessed a 46 cents rise in the morning (according to London time). The prices reached to $93.99 per barrel. February futures moreover, are up by 43 cents, being the most traded futures. On the contrary the contracts which are to expire on December 20, 2011 fell to reach as low as $92.52 on December 16, 2011. Nevertheless, prices this year are 2.9% higher after a 15% rise in 2010.
Brent oil (ready for February settlement) was at $104.09 per barrel on the ICE Futures Europe Exchange. They had earlier declined by 1% or as much as 98 cents per barrel. There are reports and speculations that the oil prices might witness a $40 per barrel rise, following a halt on the Iranian production (as earlier noted by Bank of America Corp.) it also added that a closure of the Strait of Hormuz might escalate oil prices faster.
The European Benchmark contract reached a premium price of 49.90 to West Texas Intermediate traded in New York. Olivier Jakob remarks, “There are enough contradictory pressures on the oil market to go into the holidays with a neutral position. On the bearish side there is the risk of European downgrades, but there’s also the risk of tougher rhetoric against Iran.”
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