Oil market trades mixed amid US holiday

4th July 2011, Comments 0 comments

World oil prices were mixed on Monday in light deals amid the Independence Day holiday in the United States, as traders kept one eye on fast-moving eurozone debt crisis.

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

New York's main contract, West Texas Intermediate for August, firmed eight cents to $95.02 in electronic deals.

"Considering the US holiday and lack of important statistical releases elsewhere, market action is likely to be subdued today," said Filip Petersson, commodity strategist at SEB Commodity Research.

"We see no reason to expect much market action today and therefore take a neutral to bearish stand."

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 tranche of last year's 110-billion-euro ($160 billion) EU-IMF bailout for Greece.

But in a new twist, ratings agency Standard & Poor's warned on Monday 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.

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

© 2011 AFP

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