Oil Prices Steady Near $92 per Barrel
SINGAPORE (AP) — Oil prices were steady Monday after last week’s decline on concerns that the United States, the world’s largest energy consumer, is headed for an economic recession that would crimp demand for oil.
Energy investors remained focused on recent U.S. government jobs reports that suggest the economy is struggling to make headway against the challenges posed by a troubled housing market and high oil prices.
“The threat of an economic downturn in the U.S. continues to weigh on the crude oil market, outweighing supply concerns in Nigeria and worries over Iran,” said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.
The market barely reacted to news over the weekend that U.S. President George W. Bush had called Iran, OPEC’s second-largest producer, “the world’s leading state sponsor of terror.”
“In the past, these tough remarks by Bush would have caused the market to spike. But we’re seeing none of that, and it’s a reflection of the widespread concerns over the growing threat of the U.S. economic downturn,” Shum said.
Light, sweet crude for February delivery dropped 1 cent to $92.68 a barrel in Asian electronic trading on the New York Mercantile Exchange by midday in Singapore.
The February contract has traded as low as $92.41 a barrel in the electronic session, down 28 cents from Friday, when it fell $1.02 to settle at $92.69 a barrel.
Oil prices failed to hold a sustained rally Friday on news a rebel group bombed a docked oil tanker in Nigeria, the latest incident of oil-related violence to hit Africa’s largest oil producer and a major U.S. supplier.
Remarks earlier last week by U.S. Federal Reserve Chairman Ben Bernanke that the central bank is ready to cut interest rates to help stave off a recession also failed to boost prices.
Heating oil futures added 1.11 cent to $2.5470 a gallon while gasoline prices dropped 0.1 cent to $2.3213 a gallon.
Natural gas futures rose 20.6 cents to $8.416 per 1,000 cubic feet.
In London, Brent crude rose 23 cents to $91.30 a barrel on the ICE Futures exchange
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