Oil slips to $111, growth hopes support

LONDON Mon Jan 7, 2013 4:07pm IST

A man fills a jerry can with diesel at a fuel station in Juba October 11, 2012. Picture taken October 11, 2012. REUTERS/Adriane Ohanesian/Files

A man fills a jerry can with diesel at a fuel station in Juba October 11, 2012. Picture taken October 11, 2012.

Credit: Reuters/Adriane Ohanesian/Files

Related Topics

LONDON (Reuters) - Oil eased to $111 a barrel on Monday as some investors booked profits after last week's gains, although optimism that the world's biggest economies are on a steady recovery path limited the decline.

The crude market rallied last week after U.S. lawmakers reached a last-minute agreement to avert the so-called "fiscal cliff", or tax increases and spending cuts that would have threatened growth in the world's top oil consumer.

Brent crude fell 27 cents to $111.04 a barrel by 1013 GMT, after rising 0.6 percent last week. U.S. crude slipped 29 cents to $92.80 after adding 2.5 percent last week.

"There is a bit of pullback in oil prices after the rally last week. Oil futures had gained quite a bit last week," said Victor Shum, senior partner at IHS Purvin & Gertz in Singapore.

Reports on Friday showed U.S. employers kept up an even pace of hiring in December and the country's services sector expanded briskly. This, as well as earlier data showing expansion in U.S. and Chinese manufacturing, bolstered the outlook for oil demand.

This week's focus for financial markets will be on the European Central Bank. Investors are looking to the central bank's monthly meeting on Thursday to see if it hints at an interest rate cut early this year.

Figures on Monday showed euro zone factory prices fell for the first time in five months in November, pulled down by a slide in the cost of energy and giving the ECB room to consider another interest rate cut.

Investors will also be watching the U.S. Federal Reserve's stance on monetary easing, after top Fed officials and some U.S. economists suggested the central bank might halt its asset purchases this year.

Supply concerns arising from tension and fighting in the Middle East could support oil prices. The United Nations said last week more than 60,000 people have died in Syria's uprising and civil war. (Reporting by Ramya Venugopal and Alex Lawler; editing by Keiron Henderson)

FILED UNDER:

Religion and Politics

REUTERS SHOWCASE

Fund Raising

Fund Raising

Flipkart raises $700 million in fresh funding.   Full Article 

Reforms Push

Reforms Push

Modi may order insurance, coal reforms if vote delayed - officials.  Full Article 

Reuters Exclusive

Reuters Exclusive

India looks to sway Americans with nuclear power insurance plan  Full Article 

To Boost Growth

To Boost Growth

Crank up public spending to revive growth - chief economic adviser.   Full Article 

Bold Steps

Bold Steps

SpiceJet rescue plan marks bold bet on Indian aviation recovery.   Full Article 

New Airline

New Airline

Tata, Singapore Air venture Vistara to take off on Jan 9.  Full Article 

Online Sales

Online Sales

Knock knock. Who's there? Amazon's best-selling holiday author.  Full Article 

Hacking Attack

Hacking Attack

N.Korea says did not hack Sony, wants joint probe with U.S.  Full Article 

Reuters Poll

Reuters Poll

BSE Sensex to hit 32,980 by December 2015  Full Article 

Reuters India Mobile

Reuters India Mobile

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