Brent steadies near $111 after Obama re-elected; demand eyed

SINGAPORE Wed Nov 7, 2012 1:25pm IST

An attendant holds a gas pump at a Rosneft petrol station in St.Petersburg October 23, 2012. REUTERS/Alexander Demianchuk

An attendant holds a gas pump at a Rosneft petrol station in St.Petersburg October 23, 2012.

Credit: Reuters/Alexander Demianchuk

Related Topics

Priyanka Gandhi Vadra, daughter of Congress party chief Sonia Gandhi, adjusts her flower garlands as she campaigns for her mother during an election meeting at Rae Bareli in Uttar Pradesh April 22, 2014. REUTERS/Pawan Kumar

Election 2014

More than 814 million people — a number larger than the population of Europe — are eligible to vote in the world’s biggest democratic exercise.  Full Coverage 

SINGAPORE (Reuters) - Brent futures steadied around $111 per barrel on Wednesday after uncertainties about the U.S. elections came to an end with President Barack Obama's re-election, although concerns about weak demand and Greece weighed on prices.

Worries about Iran's nuclear dispute, negotiations to avert a looming fiscal cliff - nearly $600 billion worth of spending cuts and tax hikes that risk pushing the United States into deep recession, and disruption to supplies due to escalating tensions in the Middle East are now expected to drive the market.

Front-month Brent futures were up 29 cents at $111.36 per barrel by 0740 GMT, bouncing off the day's low of $110.40. U.S. crude was up 5 cents at $88.76 per barrel, off the day's low of $87.87.

"Now the focus will be on the fiscal cliff discussions and on the Iranian dispute, all that is still ahead of us," said Tony Nunan, an oil risk manager at Mitsubishi Corp in Tokyo.

"The market appears evenly balanced with economic worries on one hand and the geopolitical worries and winter drawdown supporting. We see high volatility, but sideways trading for the rest of the year."

Greece remains another key focus area, where a key parliamentary vote on a new set of wage and pension cuts is set for Wednesday.

Greek protesters took to the streets against the new austerity measures, even though the parliament is expected to approve them by a narrow margin.

The euro zone faces the risk of "aggravation of the situation in Greece, with potential contagion effects to the rest of the area", analysts at Spanish finance company BBVA said in a report.


But supply worries continued to support oil prices after Middle East violence escalated again.

Bombs exploded in three districts of the Syrian capital Damascus on Tuesday, killing and wounding dozens, while gunmen shot dead the brother of the parliament speaker in the latest rebel attack on a figure associated with the ruling elite.

Directly impacting oil supply out of Syria, an explosion also hit the main oil pipeline feeding a refinery on the western edge of the Syrian city of Homs on Tuesday, during fighting between rebels and army forces in the area.

Moreover, supply of the North Sea crude oil that underpins the benchmark Brent contract is set to slip in December, despite the restart of Britain's largest oilfield, loading programmes showed.

U.S. crude oil inventories fell slightly last week and product stocks rose, data from the American Petroleum Institute showed on Tuesday, confounding analysts' expectations in the wake of Hurricane Sandy, which has caused widespread disruptions to East Coast refineries and terminals.

Inventory data from the Energy Information Administration is scheduled for release later on Wednesday.

Crude inventories are forecast to have risen 1.8 million barrels last week while product stocks were seen falling, an expanded Reuters poll of analysts showed on Tuesday.

Also supporting U.S. crude, data showed that Superstorm Sandy had a small impact on regional gasoline demand.

(Editing by Clarence Fernandez and Himani Sarkar)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared


Oil Imports

Oil Imports

India to make May-July oil payments to Iran - sources.  Full Article 

DLF Shares

DLF Shares

DLF slides 3 percent, underperforms rivals.  Full Article 

Global Economy

Global Economy

Chinese factories stalling as euro zone business picks up  Full Article 

Rupee Falls

Rupee Falls

Rupee falls for third day; foreign fund inflows key.  Full Article 

Record High

Record High

BSE Sensex hits record high for third straight day.  Full Article 

M&M Upgraded

M&M Upgraded

Credit Suisse upgrades Mahindra & Mahindra to 'outperform'  Full Article 



Manchester United’s crisis has silver lining  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage