Crude mixed in Asia as Spanish bond yields soar

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Crude was mixed in Asian trade Friday amid fears that Spain would be the next economy to fall victim to the eurozone debt crisis, analysts said.

New York's main oil contract, light sweet crude for delivery in December, shed 12 cents to $98.70 per barrel on its last trading day.

Brent North Sea crude for January delivery was two cents higher at $108.24.

Oil prices reflected sentiments seen across commodities and equities markets as traders fretted over Spain's financial situation at its borrowing costs soared to record levels, analysts said.

Spain's treasury had to pay 6.975 percent when it raised 3.6 billion euros ($4.8 billion) in a sale of 10-year bonds Thursday, the highest interest rate since the creation of the single currency, according to Dow Jones Newswires.

The rate is a whisker from the 7.0 percent level considered too high for governments to service their debts.

"I think it's kind of a fear that Spain will be the next country that's going to stir up the situation," said Ker Chung Yang, commodity analyst for Phillip Futures in Singapore.

Kathleen Brooks, research director at trading site, warned that Spain faced a tough road ahead in raising more funds to cut its debt.

"Spain still has 12 billion euros of debt to auction next month. If sentiment does not start to pick up then we could see funding stresses reach a critical level in Madrid very quickly," she said.

© 2011 AFP

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