Oil prices weighed down on Eurozone concerns and rise in US crude stockpiles

27-Jul-12

Oil prices have dipped in Asia, weighed down on rising concerns about the Eurozone and a sharp spike in US crude inventories. New York's main contract, light sweet crude for delivery in September, fell to US$88.6, while Brent North Sea crude for September delivery fell to US$103.9. Mid week, Spain sought French support in the face of its soaring borrowing costs, even as a decline in German confidence and a worsening British recession aggravated the situation. Also, the recession in Greece is now anticipated to be much worse than expected with the economy shrinking by over 7%. Additionally, oil inventories have risen in USA by 2.7 mln barrels last week, as per data released by the Energy Information Administration. This indicates weak demand for oil in the world’s largest consuming nation.