New York's main contract, West Texas Intermediate (WTI) for February delivery, slipped to US$90.8 a barrel, while Brent North Sea crude for February delivery fell to US$110.8 in London. Oil has declined amid doubts that a last minute deal on the "fiscal cliff" crisis could be reached by a rapidly approaching end-of-year deadline. The so-called fiscal cliff is a combination of steep tax hikes and drastic spending cuts set to kick in next month. President Barack Obama cut short his family Christmas break in Hawaii to return to Washington in a last-ditch attempt at reaching a compromise.
In all likelihood, the US economy will hurtle over the fiscal cliff because House Speaker John Boehner and Republican Minority Leader Mitch McConnell were stalling.