Forexpros – Crude oil futures were down for a third day on Tuesday, dropping to an eight-week low as lingering concerns over a possible Greek sovereign debt default and a firm U.S. dollar reduced the appeal of commodities.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in November traded at USD76.47 a barrel during European morning trade, tumbling 1.46%.
It earlier fell as much as 1.8% to trade at USD75.95 a barrel, the lowest price since August 9.
Market sentiment remained downbeat after euro zone finance ministers postponed a decision on the release of Greece’s next EUR8 billion tranche of aid until a meeting on October 17.
According to reports, Greece needs the latest round of aid to avoid running out of money by mid-October, fuelling fears over an imminent default.
The news prompted investors to shun riskier assets, such as stocks and commodities and flock to traditional safe haven assets like the U.S. dollar.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.12% to trade at 80.20, hovering close to a nine-month high.
Commodity traders will pay close attention to a meeting of finance ministers from the single currency bloc later in the day to discuss the implementation of a permanent euro zone bailout facility.
In addition, Federal Reserve Chairman Ben Bernanke is to testify on the U.S. economic outlook and recent monetary policy actions before the Joint Economic Committee in Washington.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for November delivery slumped 0.68% to trade at an eight-week low of USD101.02 a barrel, up USD24.55 a barrel on its U.S. counterpart.
Wall Street investment bank Goldman Sachs cut its Brent forecast for the remainder of the year to USD112.50 a barrel, down from a previous estimate of USD120, citing increasing supplies and a weaker global oil demand outlook.
Brent prices came under further pressure after the head of Libya’s National Oil Corporation, Nuri Berruien said that the country aims to raise oil production to 700,000 barrels a day from current levels of 300,000 barrels a day by year-end.
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