Brent crude rose to $105 a barrel on Monday to come off of a four-month low hit in the previous session, with worries about global oversupply still outweighing concerns about violence in the Middle East and North Africa.
Forecasts for a supply glut in West African and European markets help to push the Brent benchmark down 3.3 per cent last week, despite geopolitical tension in Iraq, Libya and Ukraine.
Strong U.S. economic data that signalled a better demand outlook for oil in the world's largest economy was also unable to support crude markets against the surplus barrels.
Downward pressure on oil prices is likely to continue, said Ric Spooner, chief market analyst at Sydney's CMC Markets, forecasting that Brent could drop further towards $100 a barrel.
Brent crude rose 16 cents to $105 a barrel by 0402 GMT after falling $1.18 on Friday to $104.84 a barrel, its lowest settlement since April 2.
U.S. crude for September delivery edged up 10 cents to $97.98 after ending last week at its lowest settlement since Feb. 6. U.S. crude fell more than 4 per cent last week in its biggest weekly decline since January.
Brent is in its longest contango since early 2011, reflecting weak physical demand, the bank noted. A contango market is when the front-month of a futures contract is trading at a discount to later months, signalling an expectation that prices will fall in coming months.
Forecasts for a supply glut in West African and European markets help to push the Brent benchmark down 3.3 per cent last week, despite geopolitical tension in Iraq, Libya and Ukraine.
Strong U.S. economic data that signalled a better demand outlook for oil in the world's largest economy was also unable to support crude markets against the surplus barrels.
Downward pressure on oil prices is likely to continue, said Ric Spooner, chief market analyst at Sydney's CMC Markets, forecasting that Brent could drop further towards $100 a barrel.
Brent crude rose 16 cents to $105 a barrel by 0402 GMT after falling $1.18 on Friday to $104.84 a barrel, its lowest settlement since April 2.
U.S. crude for September delivery edged up 10 cents to $97.98 after ending last week at its lowest settlement since Feb. 6. U.S. crude fell more than 4 per cent last week in its biggest weekly decline since January.
Brent is in its longest contango since early 2011, reflecting weak physical demand, the bank noted. A contango market is when the front-month of a futures contract is trading at a discount to later months, signalling an expectation that prices will fall in coming months.
No comments:
Post a Comment