Investing.com - Crude oil future traded slightly higher Monday, as continuing worries about the global economic outlook countered monetary easing comments by Federal Reserve Chief Ben Bernanke.
On the New York Mercantile Exchange, light sweet crude futures for delivery in May traded at USD106.89 a barrel during U.S. afternoon trade, easing up 0.03%.
The May contract traded in a range of USD107.32 a barrel, the daily high, and USD106.21 a barrel, the session low.
Oil prices gained traction after Fed Chairman Ben Bernanke stated that further monetary accommodation is needed to bring about big gains in the U.S. jobs market, which he described as “far from normal,” despite a recent improvement.
The comments helped fuel speculation that further quantitative easing from the central bank may be coming, weakening the U.S. dollar.
However, oil prices underperformed strong gains elsewhere across the commodities complex amid concerns over the global growth outlook and a subsequent slowdown in world energy demand.
A report from the National Association of Realtors released earlier showed that pending home sales in the U.S. declined unexpectedly in February, indicating that the recovery in the housing market remains uneven.
The data added to concerns over the outlook for global growth after worries over a possible ‘hard landing’ in China resurfaced last week, after data showed that manufacturing activity contracted for the fifth consecutive month in March.
Meanwhile, fears that the euro zone’s debt crisis could flare up again depressed sentiment after Spain’s ruling People's Party did not secure an outright majority in an election win which could make it harder to push through harsh spending cuts.
Italy’s Prime Minister Mario Monti warned over the weekend that Spain may excerbate the euro zone’s debt crisis if it doesn't push ahead with austerity measures.
Chancellor Angela Merkel said earlier that Germany would be prepared to allow running the region’s two bailout funds in parallel, which would give a total fund of EUR700 billion to combat the debt crisis in the single currency bloc.
Meanwhile, oil traders continued to monitor developments surrounding ongoing tensions between Iran and the West and a disruption to oil exports from the Islamic Republic.
Oil prices spiked higher on Friday, jumping almost USD3 per barrel in a matter of minutes before retracing some of those gains, after a report from Petrologistics, a Geneva-based industry group, indicated that Western-led sanctions are starting to take their toll on Iran's oil industry.
According to the group, Iran's oil exports in March fell by 300,000 barrels a day, or 14% from a month earlier.
U.S. President Barack Obama stated that “time is short” to solve the showdown with Iran diplomatically.
The stand-off between Iran and Western countries has dominated sentiment in the oil market for weeks, raising fears that the escalating row over Tehran's nuclear program could lead to an oil-export halt, a disruption to shipping traffic in the Strait of Hormuz or military conflict.
Growing tensions between Iran and Israel also remain in focus. There are fears that an escalation of hostilities between Israel and Iran could set off a conflict across the region and send oil prices skyrocketing.
A potential loss of Iranian barrels has helped underpin strong gains in oil prices this year and prices could go higher when a European Union embargo on Iranian oil imports go into effect on July 1.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for May delivery rose 0.37% to trade at 125.56 a barrel, with the spread between the Brent and crude contracts standing at USD18.67.
On the New York Mercantile Exchange, light sweet crude futures for delivery in May traded at USD106.89 a barrel during U.S. afternoon trade, easing up 0.03%.
The May contract traded in a range of USD107.32 a barrel, the daily high, and USD106.21 a barrel, the session low.
Oil prices gained traction after Fed Chairman Ben Bernanke stated that further monetary accommodation is needed to bring about big gains in the U.S. jobs market, which he described as “far from normal,” despite a recent improvement.
The comments helped fuel speculation that further quantitative easing from the central bank may be coming, weakening the U.S. dollar.
However, oil prices underperformed strong gains elsewhere across the commodities complex amid concerns over the global growth outlook and a subsequent slowdown in world energy demand.
A report from the National Association of Realtors released earlier showed that pending home sales in the U.S. declined unexpectedly in February, indicating that the recovery in the housing market remains uneven.
The data added to concerns over the outlook for global growth after worries over a possible ‘hard landing’ in China resurfaced last week, after data showed that manufacturing activity contracted for the fifth consecutive month in March.
Meanwhile, fears that the euro zone’s debt crisis could flare up again depressed sentiment after Spain’s ruling People's Party did not secure an outright majority in an election win which could make it harder to push through harsh spending cuts.
Italy’s Prime Minister Mario Monti warned over the weekend that Spain may excerbate the euro zone’s debt crisis if it doesn't push ahead with austerity measures.
Chancellor Angela Merkel said earlier that Germany would be prepared to allow running the region’s two bailout funds in parallel, which would give a total fund of EUR700 billion to combat the debt crisis in the single currency bloc.
Meanwhile, oil traders continued to monitor developments surrounding ongoing tensions between Iran and the West and a disruption to oil exports from the Islamic Republic.
Oil prices spiked higher on Friday, jumping almost USD3 per barrel in a matter of minutes before retracing some of those gains, after a report from Petrologistics, a Geneva-based industry group, indicated that Western-led sanctions are starting to take their toll on Iran's oil industry.
According to the group, Iran's oil exports in March fell by 300,000 barrels a day, or 14% from a month earlier.
U.S. President Barack Obama stated that “time is short” to solve the showdown with Iran diplomatically.
The stand-off between Iran and Western countries has dominated sentiment in the oil market for weeks, raising fears that the escalating row over Tehran's nuclear program could lead to an oil-export halt, a disruption to shipping traffic in the Strait of Hormuz or military conflict.
Growing tensions between Iran and Israel also remain in focus. There are fears that an escalation of hostilities between Israel and Iran could set off a conflict across the region and send oil prices skyrocketing.
A potential loss of Iranian barrels has helped underpin strong gains in oil prices this year and prices could go higher when a European Union embargo on Iranian oil imports go into effect on July 1.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for May delivery rose 0.37% to trade at 125.56 a barrel, with the spread between the Brent and crude contracts standing at USD18.67.