The price of Brent crude open’s Tuesday’s trading session hanging at $107 a barrel after falling 1.2 percent yesterday as the market prices in a lack of clear direction the surrounds the European deal to solve many of the bloc’s debt problems.
Latest Brent Oil Price
In London, Brent crude oil futures for January 2012 delivery was trading at $107.18 a barrel, 07.28 GMT this morning on the ICE Futures Exchange.
The European oil contract closed off Monday’s session at $107.33, or 1.2 percent lower on the day.
Europe – Deal or No Deal?
Concerns are growing that last week’s actions by European leaders won’t be able to prevent the euro zone’s slide toward recession and that any deal will see growth in many parts of the EU reverse next year.
The oil market has closely tracked developments in Europe as concerns grow that a recession in the region could cut into global oil demand.
Earlier Monday, ratings company Moody’s said it still expects to reassess its ratings on European sovereign debt early next year as the agreement offered few new measures.
Also, rival credit rating company Standard & Poor’s could take similar actions following its decision last week to place 15 euro-zone countries on credit watch with negative implications.
“We’re showing our disappointment with the lack of an EU deal and the possibility of more downgrades going forward.” said Phil Flynn, oil analyst at PFGBest.
“The dark cloud right now is Europe.” said Tony Rosado, a broker with GA Global Markets.