Oil Prices Retreat as Budget Uncertainty Continues: Fox Business

Oil Prices Retreat as Budget Uncertainty Continues: Fox Business

YEREVAN, December 27. /ARKA/. Oil prices eased in choppy trading on Thursday, buffeted by unresolved U.S. budget talks and the possibility that looming tax increases and spending cuts could push the top oil-consuming economy into recession.

Crude futures briefly turned higher, then seesawed, in post-settlement trading as U.S. equities cut losses on news that the U.S. House of Representatives will hold a work session on Sunday in an effort to get a budget deal.

Oil and U.S. equities prices had previously come under pressure from comments by Senate Majority Leader Harry Reid criticizing Republicans in Congress for refusing to go along with any tax increases as part of a U.S. "fiscal cliff" remedy.

"It looks like that is where we're headed," Reid, a Democrat, said of the likelihood of the U.S. economy going over the fiscal cliff of tax increases and spending cuts starting in January.

Brent and U.S. crude remained on track to post their third consecutive weekly gains.

While Brent closed in on a full-year increase of around 3 percent, U.S. crude was on track to post a 2012 decline of nearly 8 percent as accelerated domestic crude oil production and tepid demand kept prices in check.

Brent February crude fell 27 cents to settle at $110.80 a barrel, having reached $111.33.

Brent fell to $110.10 in the session, encountering support above the 200-day moving average of $110.01.

U.S. February crude dipped 11 cents to settle at $90.87 a barrel.

U.S. crude dropped to $90.05 intraday before recovering to settle back above the 100-day moving average of $90.66. Thursday's session peak of $91.44 was the highest price for front-month crude since Oct. 19.
Total Brent and U.S. crude trading volumes were around 40 percent below their 30-day averages as the holidays kept turnover thinned. –0--

11:28 27.12.2013

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