Forexpros – Oil futures were sharply lower on Monday, as investors shunned riskier assets ahead of a deadline for Greece to decide whether to accept the conditions attached to a second bailout package.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in March traded at USD96.67 a barrel, tumbling 1.17% in early European trade.
The commodity hit an earlier session high of USD97.77 and a low of USD96.63.
Greek political leaders were to meet later in the day to discuss whether they can agree to conditions required by the European Union, European Central Bank and International Monetary Fund to meet the requirements for a EUR130 billion aid package.
Over the weekend Greek Prime Minister Lucas Papademos said coalition members had agreed on some conditions, but others still needed to be addressed.
Concerns over Greece overshadowed Friday’s robust U.S. employment data, which showed that the economy added 243,000 new jobs last month, the fastest increase in nine months, bringing down the unemployment rate to a three-year low of 8.3%.
The news had sent oil prices rising on hopes that a more robust economy will need more oil and derivatives to power growth.
Oil prices remained supported amid ongoing tensions in the Middle East, as Iran continued to threaten military action in the stand-off with global powers over the country’s disputed nuclear program.
On Sunday, the deputy commander of Iran’s Revolutionary Guards said that Tehran would target any country used as a launch pad for attacks against its soil.
Elsewhere, investors were watching developments in Nigeria after an armed militant group attacked a pipeline controlled by Italy’s Eni SpA oil company over the weekend. Following the attack, the company said that approximately 4,000 barrels a day of production was lost.
On the ICE Futures Exchange, Brent oil futures for March delivery were down 0.59%, trading at USD113.88 a barrel, up USD17.21 from its U.S. counterpart.
The gap in price between the two contracts is pushing toward the higher end of a range between a nearly USD20.00 all-time high and a historical spread of USD1.00.
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