Oil prices fall on weak numbers from USA, recession in Spain

Oil prices dipped at the start of the week on news of Spain’s fall into recession and lackluster data from USA. U.S. Midwestern business activity countered supportive expectations for more Federal Reserve action to stimulate a sluggish U.S. economy. Brent June crude fell to US$119.4 a barrel. As per calgaryherald.com, Brent’s premium to U.S. crude has been lowered by reduced tensions about Iran’s nuclear program after talks with major powers restarted mid-month and by an upcoming U.S. pipeline reversal expected to relieve a bottleneck and high Midwest inventories that have hemmed in U.S. crude prices. Signs of weakness in U.S. data also raise the possibility of another round of monetary easing, seen as supportive to dollar-denominated commodities. Spain fell into recession in the first quarter and economists said austerity measures to meet strict EU deficit limits and a reeling bank sector would delay a rebound until late 2012 or beyond.
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