SINGAPORE: Brent crude held near $111 per barrel on Thursday as jittery investors stayed on the sidelines with a deadline to avert a US fiscal crisis approaching, while hopes the new Japanese government's policies will spur demand supported prices.
US President Barack Obama and Republican lawmakers resumed talks on Wednesday over the so-called fiscal cliff - tax hikes and spending cuts slated to take effect next week that could push the economy back into recession.
"There is no easy way to resolve the US fiscal cliff, but there should be a compromise at some point and that's what the market is looking for," said Tetsu Emori, a commodity fund manager at Astmax in Tokyo.
Front-month Brent futures slipped 16 cents to $110.91 per barrel at 0501 GMT, giving up some of the previous session's 2 percent gain.
Brent may face some resistance between $112 and $113 before falling towards $102.7 over the next three months, according to Wang Tao, Reuters market analyst for commodities and energy technicals.
US crude dropped from a nine-week high reached on Wednesday, shedding 6 cents to $90.92.
Oil futures rose in early Asian trade, taking a cue from Japanese stocks, which were at an 18-month high after the country's new prime minister said beating deflation in the world's No. 3 oil consumer and taming a strong yen were his top priorities.
"There are hopes that the aggressive fiscal policies will help Japan get out of deflation and, as it is an importer of commodities, that's a positive for oil markets," Emori said.
The government will pursue bold monetary policy, flexible fiscal policy and a growth strategy to encourage private investment, Prime Minister Shinzo Abe said on Wednesday .
Center>Copyright Reuters, 2012
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