LONDON: World oil prices traded narrowly mixed on Tuesday after starting the week with losses as traders balanced economic and political worries in the eurozone against tight supply concerns.
Brent North Sea crude for delivery in June fell 51 cents to $118.20 a barrel in late morning London deals, a day after briefly dropping under $118.
New York's main contract, West Texas Intermediate (WTI) crude for June rose 47 cents to $103.58.
Crude futures sank on Monday on weak economic data and eurozone political uncertainty after the poor showing of Nicolas Sarkozy in the first round of France's presidential election, and the resignation of the Dutch government.
"Political uncertainty and poor economic data from the eurozone have given rise to greater risk aversion and prompted the oil price to fall below the $118 a barrel mark for a time yesterday," added Commerzbank analyst Carsten Fritsch.
"The slight price recovery we have seen in the meantime is largely thanks to the latent supply risks.
"Oil production at the Buzzard oilfield in the North Sea, for instance, has been interrupted following an incident.
"Normally the Buzzard oilfield produces 200,000 barrels of Forties crude oil per day, the main ingredient of the Brent family."
The Buzzard oilfield, operated by Canadian company Nexen Inc., was halted on Saturday after a technical incident but is expected to recommence over the next two days.
Markets were hit Monday by growing uncertainty over the political situation across Europe. Dutch prime minister Mark Rutte resigned after his government failed to reach agreement over austerity measures.
"Continued concern over the eurozone is playing a role, particularly after political developments in the Netherlands and France," said Inenco analyst Tom Pering.
"Oil ... has been reluctant to push above $119 per barrel despite supply concerns lingering in the background," he added.
Data showed that eurozone private sector activity sank at the fastest rate in five months in April, indicating a longer recession than previously thought.
And it also emerged that debt-laden Spain -- one of the eurozone's beleaguered economies -- plunged back into recession in the first quarter of 2012.
In Asia, HSBC's China purchasing managers index (PMI), which measures factory output, rose to 49.1 in April from 48.3 in March, still in contraction territory.
China's economy is closely watched by oil traders as it is the world's largest energy-consuming nation.
Traders are meanwhile awaiting Wednesday's weekly snapshot of crude reserves in the United States, which is the biggest oil-consuming country in the world.
Comments
Comments are closed.