Oil prices mixed amid US holiday

4th July 2011, Comments 0 comments

World oil prices were mixed on Monday in light deals, with many traders away for the Independence Day holiday in the United States.

Brent North Sea crude for delivery in August shed 15 cents to $111.62 a barrel in midday London trade.

New York's main contract, West Texas Intermediate for August, added 22 cents to $95.16 in electronic deals.

"With the US markets closed for the Independence Day, crude oil prices are likely to consolidate today while currency movements might provide some direction," said analyst Myrto Sokou at the Sucden Financial Research brokerage.

"However, in an absence of major macroeconomic figures, it is likely to have light trading volumes."

Prices had rallied last week after a vote in the Greek parliament eased worries about a potential eurozone default and tempted more traders into riskier investments.

Eurozone finance ministers cleared the way on Saturday for Greece to receive the next 12-billion-euro slice of its 110-billion-euro ($160-billion) EU-IMF bailout.

However on Monday, ratings agency Standard & Poor's warned that debt rollover plans for crisis-hit Greece could amount to a "selective default."

A key factor supporting oil prices is the "confirmation that Greece will get the batch of bailout money from the eurozone," said Victor Shum, a Singapore-based analyst with Purvin and Gertz energy consultancy.

"That has eased concerns about Greece sinking the European region into a downturn," he told AFP.

Any Greek default would shatter investor confidence, rock global financial markets and slash European demand for energy, according to analysts.

Oil prices had been hit late last week on news of a sharp manufacturing slowdown in China, the world's biggest consumer of energy.

Sentiment was also hit by downbeat manufacturing data in Britain and the eurozone, and only slightly positive figures for June from the United States.

"For the rest of 2011, we could expect potential slowdown of the Chinese economy due to recent fairly poor Chinese macroeconomic indicators," analyst Sokou said on Monday.

"In the United States, economic indicators are also fairly weak giving mixed signals. In the meantime, the situation in the eurozone looks fairly volatile with investors being cautious as the Greek debt issues are still pending."


© 2011 AFP

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