Brent oil prices end a mixed trading week firm at $117 a barrel as the US dollar lost some recent gains and debt talks in Europe and the US had investors on edge about short term currency swings, something which affects oil prices and other commodities.
Brent Oil Futures – Closing Price
Brent crude oil futures for September 2011 delivery ended the week’s trading session at $117.66 a barrel on the ICE Futures Exchange yesterday evening, $0.67 lower than last week’s closing price of $118.33 a barrel. The August Brent oil futures contract expired yesterday.
US Dollar Index
The ICE US Dollar Index, which tracks the US dollar against six major world currencies was doen 0.2 percent on Friday, closing at 75.13. A weaker US dollar makes oil futures cheaper to buy for investors using other currencies and tends to boost oil prices.
Europe Debt Talks
Euro zone governments and the ECB have been arguing for three months about whether banks and other bondholders should be made to share the burden of funding Greece, with the ECB and some national capitals arguing that imposing costs on private investors could wreck the market’s confidence in many other euro countries.
European Council President Herman Van Rompuy announced a special summit on Friday, saying the heads of the 17 countries that use the euro will discuss “future financing” of Greece.
Meanwhile, a sharp selloff of Italian and Spanish bonds in recent days fueled fear that the debt crisis might escalate beyond Europe’s control.
Failure to agree on a smooth path forward for Greece’s debts may push the euro currency lower and the US dollar could benefit from the uncertainty surrounding Europe’s debt problems.
But for the moment, it seems the US is also facing a similar debt situation, hence oil prices may strengthen again of the back of general market uncertainty while global oil demand remains strong.