Debt ceiling can suffocate the oil prices sharply

Brent crude oil price is trading at around 112 dollars and the West Texas intermediate is selling at approximately 94 dollars per barrel. The prices have remained resilient for some time now thanks to the improving market sentiments and world economy, speculation gains and stronger demand particularly in China.
However, the fundamentals are softening at least in the short term. Refinery consumption that has contributed to the stronger demand is likely to fade in the coming months with factory maintenance on the cards.
Though the Arab Spring has subsided, the geopolitical disruptions still hover like old melodies. Moreover, OPEC will play the role of a global regulator and cut production to impede inventory buildup.
It is truism that the risk perception of speculators in the oil market hinges upon the financial market events more than the oil market specifics. This is why the oil prices have reacted to the Eurozone debt crisis and the US weakening more than they have to the some offshore disasters and major events like the Arab Spring in 2011.
Amazingly, the terror of 2012 - fiscal cliff - remained weak on the oil market dynamics. The oil market uncertainty measured through the crude oil volatility index OVX has been on the lower side after falling sharply somewhere in the middle of 2012.
This could be one-off event. The greatest of all threats is whats lying ahead in the financial market. And analysts reckon that in cases where the speculators in the oil market have high net long position, which is highest in months now, an event can trigger large sell-offs which in turn could result in a sharp slide in oil prices.
The countdown to that major event has begun, which can rattle the oil market; the debt ceiling deliberations come February 2013 are very likely to stir the fears that somewhat settled down and raised risk appetite with the last minute deal over the US fiscal cliff.
On the contrary, major forecasts also show a faster growth in the second half of 2013. The view of the economic growth or unforeseen supply disruptions awakening the giant and pulling crude up the price ladder can never be ruled out.